Organic CommodityChemicals

USITC Publication 3590March 2003

OFFICE OF INDUSTRIESU.S. International Trade CommissionWashington, DC 20436

UNITED STATES INTERNATIONAL TRADE COMMISSION

This report was prepared principally by

Gary F. Stolz

Organic and Inorganic Chemicals BranchEnergy, Chemicals, and Textiles Division

Additional input provided by

Elizabeth R. Nesbitt

Chief, Organic and Inorganic Chemicals Branch

Vern Simpson

Robert A. Rogowsky

Address all communications toSecretary to the Commission

United States International Trade CommissionWashington, DC 20436

Director of Operations

Director of Industries

COMMISSIONERS

Marcia E. Miller

Deanna Tanner Okun, ChairmanJennifer A. Hillman, Vice Chairman

Stephen Koplan

Under the direction of

John J. Gersic

Chief, Energy, Chemicals and Textiles Division

1 The information and analysis provided in this report are for the purposes of this report only.Nothing in this report should be construed to indicate how the Commission would find in aninvestigation conducted under statutory authority covering the same or similar subject matter.

i

PREFACE

In 1991 the United States International Trade Commission initiated its current Industry andTrade Summary series of informational reports on the thousands of products imported intoand exported from the United States. Each summary addresses a differentcommodity/industry area and contains information on product uses, U.S. and foreignproducers, and customs treatment. Also included is an analysis of the basic factors affectingtrends in consumption, production, and trade of the commodity, as well as those bearing onthe competitiveness of U.S. industries in domestic and foreign markets.1 This report onorganic commodity chemicals covers the period 1997-2001.

iii

CONTENTSPage

Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . i

Abstract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

U.S. industry profile . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

U.S. market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Consumer characteristics and factors affecting demand . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11Consumption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11Production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

U.S. trade . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15U.S. imports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Principal suppliers and import levels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17Tariff and nontariff measures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17U.S. government trade-related investigations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

U.S. exports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20Principal markets and export levels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21Foreign trade measures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Foreign industry profile . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25Middle East . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

iv

CONTENTS-ContinuedPage

Appendixes

A. Tariff and trade agreement terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1B. Statistical tables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1

Figures

1. Benzene chain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42. Xylene chain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53. Chemical mergers and acquisitions worldwide, 1997-2001 . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Tables

1. Organic commodity chemicals: Harmonized Tariff Schedule classification, 2001 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

2. Organic commodity chemicals: import-to-consumption ratio, 1997-2001 . . . . . . . . . . . . . . 123. Organic commodity chemicals: U.S. production, exports of domestic

merchandise, imports for consumption, and apparent consumption, 1997-2001 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

4. Organic commodity chemicals: productivity and unit labor costs, 1997-2001 . . . . . . . . . . . 155. Relative price history of crude petroleum and natural gas, 1987-2001 . . . . . . . . . . . . . . . . . 156. Trade balance of certain commodity chemicals, 1997-2001 . . . . . . . . . . . . . . . . . . . . . . . . . 167. Organic commodity chemicals: Harmonized Tariff Schedule subheading;

description; U.S. column 1, Special, and column 2 rates of duty as of Jan. 1, 2002; U.S. imports, 2001; and U.S. exports, 2001 . . . . . . . . . . . . . . . . . . 18

B-1. Organic commodity chemicals: U.S. imports for consumption, by principal sources, 1997-2001 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-2

B-2. Organic commodity chemicals: U.S. exports of domestic merchandise, by principal markets, 1997-2001 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-7

OMB No.: 3117--0188

03/03

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ATTN:OFFICE OF INDUSTRIESITS: Organic Commodity Chemicals

1

ABSTRACTThis report addresses trade and industry conditions for the organic commoditychemicals, also known as petrochemicals, a category of chemicals derived fromcrude petroleum. These chemicals are used primarily as intermediates in theproduction of a wide variety of downstream goods, including plastics andapparel. The period of study is from 1997 through 2001.

• The U.S. organic commodity chemicals industry produced anaverage $18.9 billion of these goods each year during 1997-2001.The average annual trade surplus during this period was$600 million.

• The largest U.S. export markets of these products were Mexico andCanada, which accounted for approximately 41 percent of allexports by value (or $3.17 billion) in 2001. Major U.S. importsources included Canada, Venezuela, and Nigeria, which togetheraccounted for approximately 53 percent of these imports by value(or $2.49 billion) in 2001.

• Consumers of these chemicals typically use them as intermediatesin numerous products, including plastics, adhesives, and nylonfibers. There is little or no quality differentiation betweendomestically-produced commodity chemicals and U.S. imports. Theglobal market is highly competitive and large fluctuations indomestic production, imports, and exports regularly occur. Thesefluctuations are caused by a variety of factors that include demandfor downstream goods, cost of feedstocks, transportation costs, andproducer efficiency. In particular, the general economic decline in2001 contributed to the decline in U.S. production levels for thatyear.

1 Although the xylenes are usually produced directly from crude petroleum or toluene rather than frombenzene, they share the aromatic ring structure of the other benzene derivatives and are sold in a similarfashion, and are thus included in the scope of this report. Highly specialized benzene derivatives, usuallyproduced in smaller quantities, are not included in the organic commodity chemicals classification and arenot considered in this report. 2 “Ethylbenzene,” Apr. 30, 2001, found at http://www.chemexpo.com/news/ profile010430.cfm, retrievedJan. 7, 2002. 3 Commission telephone conversations with industry sources.

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INTRODUCTIONThe organic commodity chemicals are a group of petroleum-derivative chemicals (alsoknown as petrochemicals) used as intermediates to produce other chemicals, which, in turn,are used to manufacture a wide variety of end-use products, including construction materials,apparel, adhesives, plastics, and tires (figures 1 and 2). The majority of the organiccommodity chemicals are derived from benzene, a petroleum derivative itself, which has anunsaturated ring of six carbon atoms (also known as an aromatic ring).1 Examples of specificcompounds in this group include ethylbenzene, styrene, cumene, phenol, cyclohexane,aniline, ortho-xylene, meta-xylene, para-xylene, and terephthalic acid.

As commodities, the chemicals produced by one manufacturer are virtually indistinguishablefrom those of another manufacturer, given the same levels of purity. This fungibility ofgoods allows consumers to purchase similar product from a wide variety of suppliers,making price the dominant economic factor in purchasing decisions. Total domesticproduction of the organic commodity chemicals in 2001 approached $18.2 billion. A briefsummary of the six largest organic commodity chemicals, ranked by domestic productionvalue in 2001, follows (for more information on production levels, see the section later inthis report entitled “U.S. Market”).

Ethylbenzene is an intermediary chemical, 99 percent of which is used in the production ofstyrene monomer,2 which is itself a precursor of polystyrene and other materials.Ethylbenzene is commonly produced by the alkylation of benzene with ethylene in thepresence of aluminum chloride catalyst. Recently, several manufacturers have begun usingzeolite catalysts in place of aluminum chloride to improve yields and purity levels. Inaddition to the various manufacturing processes, it can also be separated directly from crudepetroleum, although industry sources state that this method of production is seldom usedbecause of typically higher production costs.3 Ethylbenzene is primarily used captively, withlittle reaching the merchant market. As a result, U.S. price data are not readily available,although some plants use an internal charge to allocate costs. Domestic production in 2001was valued at $2.5 billion.

4

Figure 1 Benzene Chain

Source: American Chemistry Council (ACC). Modified by staff of the U.S. International Trade Commission. Reprinted with permission of the ACC.

Crude Oil

Ethylene Cracker

Benzene

Ethylebenzene Styrene

Polystyrene Resins

Insulation, Cups,

Models

Styrene Acrylonitrile

Resins

Instrument Lenses,

Houseware

Styrene Butadiene

Rubber Tires, Footwear, Sealants

Styrene Butadiene

Latex

Carpet Backing,

Paper Coatings

Miscellaneous

Cumene

Acetone

Phenol

Bisphenol A

Phenolic Resins

Miscellaneous

Polycarbonate Resins

Epoxy Resins

Football Helmets,

Eyeglasses, Computers

Protective Coatings, Adhesives

Plywood, Coatings, Housings

Cyclohexane

Adipic Acid

Caprolactam

Miscellaneous

Nylon Fibers & Resins

Miscellaneous

Nylon Fibers & Resins

Aniline

Isocyanates

Rubber Chemicals

Pesticides

Dyes

Miscellaneous

Chlorobenzenes

Miscellaneous

Pesticides, Dyes

5

Figure 2 Xylene Chain

Source: American Chemistry Council (ACC). Modified by staff of the U.S. International Trade Commission. Reprinted with permission of the ACC.

Plastic Products

Crude Oil Xylene

o-Xylene

m-Xylene

p-Xylene

Phthalic Anhydride

Isophthalic Acid

Terephthalic Acid/Dimethyl Terephthalate

Plasticizer D.O.P.

Alkyd Resins

Solvents & Misc. Alkyd

Resins

Auto Parts, Coatings, Furniture

Solvents

Dyes

TV Parts

Polyester Fibers for Apparel, PET

Resins for Bottles, Tapes & Films

Polyester Polyol Urethanes Foams,

Insulation

Polyamide Resins

Adhesives

Unsaturated Polyesters

4 “Styrene,” May 14, 2001, found at http://www.chemexpo.com/news/profile010430.cfm, retrieved Jan. 7, 2002. 5 “PTA/DMT,” Chemical Market Reporter, Oct. 22, 2001. 6 Isomers are compounds that have the same molecular formula but different structural formulas. 7 “Paraxylene,” May 11, 1998, found at http://www.chemexpo.com/news/ profile980515.cfm, retrievedJan. 7, 2002. 8 “Cumene,” Mar. 22, 1999, found at http://www.chemexpo.com/news/profile990322.cfm, retrieved Jan.7,2002.

6

Styrene monomer (or simply “styrene”) is made predominantly through dehydrogenation ofethylbenzene, although a major producer uses an alternative method of oxidation ofethylbenzene, which produces co-products propylene oxide and styrene. Uses for styrene arevaried, including the production of polystyrene (accounting for 66 percent of styreneconsumption), plastics, rubber, and resins.4 These secondary products are then used in themanufacture of automotive interiors, boat hulls, paper coatings, pipes, and CD cases.Domestic styrene production in 2001 was valued at $1.9 billion.

Terephthalic acid is produced primarily from para-xylene feedstocks. As an intermediatechemical, it is further processed into purified terephthalic acid (PTA). Approximately50 percent of PTA is used for the production of polyethylene terephthalate (PET) resins and43 percent is used for the production of polyester fibers.5 Domestic production in 2001 wasvalued at $2.1 billion.

Para-xylene (p-xylene) is one of three distinct isomers6 of the xylene molecule, the other twobeing ortho-xylene (o-xylene) and meta-xylene (m-xylene). p-Xylene is used almostexclusively for production of purified terephthalic acid and dimethyl terephthalate, which,in turn, are used in polyester fiber for textiles, PET resins for beverage containers, and avariety of films and other resins.7 Domestic production in 2001 was valued at $1.8 billion.

Virtually all domestic cumene production is oxidized to cumene hydroperoxide, which isthen cleaved catalytically to produce phenol and acetone.8 This method results inapproximately 0.62 pounds of acetone per pound of phenol produced. Domestic cumeneproduction in 2001 was valued at $1.5 billion. End-uses for phenol include bisphenol-A(primarily used in the manufacture of epoxy resins and polycarbonates), phenolic resins, andcaprolactam. Domestic phenol production in 2001 was valued at $1.4 billion.

9 William J. Storck, “Top 100 Shrinks to 75,” Chemical & Engineering News, May 3, 1999, p. 19.

7

U.S. INDUSTRY PROFILEOrganic commodity chemicals, as defined in this report, are classified in chapter 29 of theHarmonized Tariff Schedule (HTS) of the United States. A complete listing can be found intable 1. Applicable North American Industry Classification System (NAICS) U.S. NationalIndustry codes include 325110, Petrochemical Manufacturing, and 325199, All Other BasicOrganic Chemical Manufacturing.

Table 1Organic commodity chemicals: Harmonized Tariff Schedule classification, 2001

HTSsubheading Chemical name

2902.11.00 Cyclohexane2902.19.00 Dicyclopentadiene and other cyclanes, cyclenes, and cycloterpenes2902.41.00 ortho-Xylene2902.42.00 meta-Xylene2902.43.00 para-Xylene2902.50.00 Styrene2902.60.00 Ethylbenzene2902.70.00 Cumene2902.90.10 Pseudocumene2902.90.20 Acenaphthene, chrysene, cymene, dimethylnapthalenes, fluoranthene, fluorene, indene,

mesitylene, methylanthracene, methylnaphthalene, phenanthrene and pyrene2902.90.30 Alkylbenzenes (including dodecylbenzene) and polyalkylbenzenes2902.90.40 Anthracene; and 1,4-di-(2- methylstyryl)benzene2902.90.60 Biphenyl (diphenyl), in flakes2902.90.90 Other cyclic hydrocarbons2906.12.00 Cyclohexanol, methylcyclohexanols and dimethylcyclohexanols2907.11.00 Phenol (hydroxybenzene) and its salts2917.35.00 Phthalic anhydride2917.36.00 Terephthalic acid and its salts2917.37.00 Dimethyl terephthalate2921.41.10 Aniline2921.41.20 Aniline salts2933.71.00 6-Hexanelactam (epsilon-caprolactam)Source: USITC, Harmonized Tariff Schedule of the United States, 2002.

Producers of these chemicals include a combination of petroleum refineries and traditionalchemical manufacturers. For example, refineries are the major producers of the xyleneisomers, which are direct derivatives of crude petroleum, and of the immediate downstreamproducts of crude petroleum. Chemical manufacturers are the major producers of styrene,caprolactam, and aniline. However, both types of firms do produce both groups of products.

The domestic chemical industry has undergone significant consolidation via mergers andacquisitions during 1997-2001. In this period, Chemical and Engineering News changed itsannual overview of domestic chemicals producers from the top 100 producers to the top 75.9

This change was a result of the extensive consolidation in the chemicals industry ofcompanies of all sizes. The annual value of mergers and acquisitions among chemicalproducers worldwide ranged from $33 billion in 1997 and 2000 to $38 billion in 1999 (see

10 Joseph Chang, “The Forecast for Petchems,” Chemical Market Reporter, Oct. 15, 2001, p. e32. 11 Sean Milmo, “Taking on the Petchems Challenge,” Chemical Market Reporter, Oct. 15, 2001, p. e22.

8

Figure 3Chemical mergers and acquisitions worldwide, 1997-2001

figure 3). The largest acquisition in the United States during this period was Dow’s$9 billion purchase of Union Carbide, which was announced in 1999 but did not close until2001. Other notable consolidations among the petrochemical producers included the creationof ExxonMobil Chemical (1999), Lyondell Chemical’s acquisition of Arco Chemical (1998),and the creation of two joint ventures (Chevron Phillips Chemical LP (2000) and EquistarChemicals LP (1997)).10 Because of economies of scale and the highly competitivemarketplace, midlevel companies are often unable to compete effectively in thepetrochemicals markets.11 Small companies (corporations with sales under $200 million)often do not produce organic commodity chemicals but instead produce specialty chemicals.These specialty chemicals are marketed on factors other than price. Specialty chemicals arenot included in the scope of this summary.

12 “Healthy Demand Is Boosting Fibres on the Mend,” Chemical Market Reporter, Oct. 2, 2000, pp. 62-63. The facility is a joint venture between Chevron Phillips Chemical Company LLC (CPChem) and SaudiIndustrial Investment Group. CPChem, in turn, is a joint venture of ChevronTexaco Corp. and PhillipsPetroleum Co. “Saudi Chevron Phillips Company Expands Cyclohexane Capacity,” Chevron PhillipsChemical Company LLC, press release, Mar. 7, 2002. 13 “Aniline,” Chemical Week, Dec. 12, 2001, p. 31. The planned project would be a joint venture betweenBASF, Huntsman, Shanghai Chlor-Alkali Chemical, Shanghai Hua Yi, Sinopec, and Sinopec Shanghai GaoQuiao. 14 Sean Milmo, “Taking on the Petchems Challenge,” p. e22. 15 U.S. Census Bureau, 1997 Economic Census, NAICS subsector code 325 -- Chemical Manufacturing. 16 U.S. Department of Commerce, Bureau of Economic Analysis, Gross Domestic Product by Industry inCurrent Dollars As a Percentage of Gross Domestic Product, 1994-2000, Nov. 2, 2001, p. 4. 17 U.S. Census Bureau, 1997 Economic Census, NAICS U.S. National Industry code 325110 --Petrochemical Manufacturing. 18 Ibid. 19 McGraw Hill Companies and U.S. Department of Commerce, International Trade Administration,U.S. Industry & Trade Outlook 2000, p. 11-6.

9

In addition to consolidation within the domestic industry during 1997-2001, there was alsoan increase in joint ventures in foreign production facilities, particularly in the Middle East,given the large indigenous supplies of crude petroleum. Two examples of such investmentinclude the startup in 2000 of Saudi Chevron’s cyclohexane facility in Al Jubail, SaudiArabia,12 and the prospective startup in 2004 of an aniline production facility in Shanghai,China.13 Globalization is likely to continue because of economies of scale and to ensurereliable access to crude petroleum.14

Most of the organic commodity chemicals have more than 10 domestic producers, even afterthe recent increase in mergers. No single company is a major producer of all of the organiccommodity chemicals. Instead, firms tend to focus on a few of the related products. Forexample, the largest producers of styrene are also the largest producers of ethylbenzene, aprecursor of styrene. The petroleum refineries, such as BP, ExxonMobil, Shell, and Sunoco,tend to be the major producers of the xylene isomers, since these products are usuallyproduced directly from crude petroleum.

Domestic manufacturing of organic commodity chemicals is centered in the Louisiana/Texasarea. Close proximity to a deep water port, natural stores of crude petroleum, and refiningfacilities all serve to minimize transportation costs and allow for multiple processing stepsto take place in a single location. A large majority of the major domestic producers haveproduction facilities in this area.

Overall, the domestic chemical manufacturing industry produced $420 billion in industryshipments in 1997.15 Chemicals and allied products ranged from 1.9 percent to 2.0 percentof gross domestic product (GDP) between 1997 and 2000.16 The domestic petrochemicalmanufacturing sector produced $20.5 billion in industry shipments in 1997, with54 establishments within the United States.17 The U.S. petrochemical manufacturing industryhad 10,943 paid employees and an average payroll of $60,611 per employee.18

Many of the commodity chemicals are available for purchase at specific purity levels, whichminimizes the difficulty of switching supply sources. As a result, pricing and currencyfluctuations are major determinants in choosing suppliers.19 Because most product is soldfree on board, freight costs and, by extension, distance between buyer and seller, are also

20 T. Kevin Swift et al, Guide to the Business of Chemistry, American Chemistry Council (ACC), 2001,p. 85. 21 Neil Franz, “Economic Woes Hurt Investment in R&D,” Chemical Week, Dec. 5, 2001, p. 57; alsobased on conversations with industry sources. 22 Guide to the Business of Chemistry, ACC, 2001, p. 84. 23 Ibid. 24 Based on Commission telephone conversations with industry sources. 25 Malini Hariharan, “Demand Rises as Economies Recover,” Chemical Market Reporter, May 22, 2000,p. S52. 26 T. Kevin Swift and Martha Moore, “US Chemical Industry Outlook: Trade and Domestic Demand,”Chemical Market Reporter, June 18, 2001, p. 33. 27 “Nitrogen oxides, or NOx, is the generic term for a group of highly reactive gases, all of which containnitrogen and oxygen in varying amounts. Many of the nitrogen oxides are colorless and odorless. However,one common pollutant, nitrogen dioxide (NO2) along with particles in the air can often be seen as areddish-brown layer over many urban areas. Nitrogen oxides form when fuel is burned at high temperatures,as in a combustion process. The primary sources of NOx are motor vehicles, electric utilities, and otherindustrial, commercial, and residential sources that burn fuels.” U.S. Environmental Protection Agency,“NOx: What Is It? Where Does It Come From?”, Mar. 22, 2002, found at Internet addresshttp://www.epa.gov/air/urbanair/nox/what.html, retrieved Mar. 14, 2003.

10

relevant. Pricing of the organic commodity chemicals products is often closely tied tobenzene prices, which are similarly tied to crude petroleum feedstock prices. The industryuses a combination of long-term pricing contracts and a spot market to conduct sales. Severalperiodicals regularly publish trade list prices for a variety of these chemicals; however, theseprices do not always accurately reflect true contract prices, as many companies considerpurchasing terms to be confidential information.

Research and development (R&D) spending in the basic industrial chemicals industry, whichincludes both organic and inorganic chemicals, increased from $3.95 billion in 1994 to $5.69billion in 2000.20 However, R&D spending in 2001 decreased by 7 percent to $5.3 billion,primarily as a result of the poor market conditions in that year.21 Typically, R&D spendingis approximately 5 percent of annual sales and is divided into three different categories: basicresearch aimed at discovering new scientific facts in the general realm; applied researchperformed with the intent of using known compounds to achieve a specific goal or result;and developmental research converting scientific knowledge into a form usable byconsumers.22 From 1991 to 2000, total research expenditures in the chemical industry havebeen divided as follows on average: 11 percent toward basic research, 33 percent towardapplied research, and 56 percent toward developmental research.23

Feedstock costs are the highest variable cost in production of the organic commoditychemicals.24 The larger producers integrate feedstocks and derivatives production in orderto minimize production costs and price fluctuations. Smaller firms do not possess thisintegration flexibility, making them more susceptible to variations in feedstock price swings.When feedstock prices rise, manufacturers often lower operating rates or suspend productionif price increases are not possible.25 Some producers have the ability to switch feedstocks inorder to obtain better market prices.

The industry has faced numerous challenges during the past few years, many of whichcontinue today, including issues related to the environment, fluctuations in energy prices,varying global demand levels, and changes in the strength of the U.S. dollar.26 One ongoingenvironmental challenge that could affect domestic producers’ competitiveness in worldmarkets is the required reduction of nitrogen oxides (NOx) emissions in Texas.27 In 2000, theU.S. Environmental Protection Agency asked the Texas Natural Resources ConservationCommission (TNRCC) to develop a state implementation plan for the Houston, Dallas-Fort

28 Carol Cole, “Lawmakers Propose Tax Break for NOx Reduction Effort,” Octane Week, Apr. 23, 2001,p. 1. 29 Suzanne McElligott, “TNRCC to Decide NOx Emission Cuts Soon,” Chemical Week, May 15, 2002,p. 21; and Peck Hwee Sim, “ ”Gulf Coast: Will Environmental Costs Crimp Growth?”, Chemical Week, May15, 2002, p. 19. 30 “Texas Expects Swift EPA Approval of New Clean Air Rules,” Platt’s Oilgram News, Dec. 18, 2002,p. 6; and “New Ozone Findings Drive Strong Pollution Reduction Plan,” Texas Commission onEnvironmental Quality, Press Release, Dec. 13, 2002. The revised plan, which was expected to be approvedby the U.S. Environmental Protection Agency, would also call for a reduction of 64 percent in emissions ofcertain highly reactive volatile organic compounds. 31 Peter Fairley, “Canadian Chemicals: Running on Empty,” Chemical Week, July 19, 2000.

11

Worth, Beaumont, and San Antonio areas to improve air quality.28 The initial TNRCCproposal to cut NOx emissions by 90 percent by 2007 would, according to some sources,require significant expense for chemical producers with no corresponding return oninvestment.29 In December 2002, however, the Texas Commission on Environmental Qualitypassed new regulations calling for an 80 percent reduction in NOX emissions.30

U.S. MARKET

Consumer Characteristics and Factors Affecting Demand

Consumers of the organic commodity chemicals are producers of downstream chemicalderivatives. Most of the commodity chemicals are available on the merchant market,although some of the these chemicals, such as ethylbenzene, are consumed almost entirelyon a captive basis. The markets utilize a combination of long-term contracts and a spotmarket. In times of excess supply, consumers will utilize the lower-priced spot market tobuild up inventory levels.

Demand for organic commodity chemicals is closely tied to demand for derivative products,including end products such as nylon, coatings, rubber and plastics. The demand for these,in turn, is linked to established business sectors, such as automobiles and tires, whoseeconomic viability is linked to gross domestic product (GDP) and the state of the worldeconomy. Therefore, the GDP in any year can result in substantial changes in demand forthe chemicals covered in this report.

Consumption

Because of the globalization of the markets for organic commodity chemicals, buyers areable to purchase virtually identical product from many different producers, domestic orforeign. As shown in table 2, the import-to-consumption ratio increased from 4.9 percent in1997 to 5.9 percent in 2000, before declining to 5.8 percent in 2001. According to oneindustry source, much of the increase from 1997 to 2000 was due to increased imports ofstyrene. These imports, primarily from Canada, were the result of increased investment inpetrochemical manufacturing in Canada in the mid-1990s because of newly discovered storesof natural gas.31 Ethylbenzene and terephthalic acid have import-to-consumption ratios of1.2 percent or less because consumers are more likely to import the precursor chemicals(benzene and para-xylene, respectively) and then produce the two products onsite.

32 Peck Hwee Sim, “Warning: Styrene Capacity Shortage Ahead,” Chemical Week, Sept. 13, 2000, p. 68. 33 “Styrene Industry to Recover after Dismal 2001," Oil & Gas Journal, Feb. 4, 2002, p. 52. 34 Ibid. 35 Robert Brown, “PET Market is Resilient Despite U.S. Economic Drop,” Chemical Market Reporter,July 2, 2001, p. 16. 36 “PTA/DMT,” Chemical Market Reporter, Oct. 22, 2001, p. 31. 37 “Phenol,” Chemweek, Jan. 9, 2002, p. 31.

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Table 2Organic commodity chemicals: import-to-consumption ratio, 1997-2001

(Percent, based on dollar values)

Item 1997 1998 1999 2000 2001Styrene . . . . . . . . . . . . . . . . . . . . . . . . . 5.8 5.1 8.9 15.9 24.7Cumene . . . . . . . . . . . . . . . . . . . . . . . . 13.3 9.6 11.7 14.0 12.4para-Xylene . . . . . . . . . . . . . . . . . . . . . 13.2 14.2 10.0 12.7 9.4Cyclohexane . . . . . . . . . . . . . . . . . . . . . 5.7 1.5 1.4 0.1 4.1Ethylbenzene . . . . . . . . . . . . . . . . . . . . (1) (1) (1) (1) 0.8Phenol (hydroxybenzene) . . . . . . . . . . . 4.8 5.4 6.0 1.8 0.66-Hexanelactam (epsilon-

caprolactam) . . . . . . . . . . . . . . . . . . 5.0 4.3 1.6 1.0 0.5Terephthalic acid and its salts . . . . . . . . 0.4 0.3 0.7 1.0 1.2All others . . . . . . . . . . . . . . . . . . . . . . . . 3.7 3.4 3.2 3.0 2.5

Total . . . . . . . . . . . . . . . . . . . . . . . . 4.9 4.3 4.5 5.9 5.8 1 Less than 0.05 percent.Source: Based on official statistics from the U.S. Department of Commerce, American Chemistry Council, NationalPetrochemical & Refiners Association, and U.S. International Trade Commission staff estimates.

Future demand for the organic commodity chemicals depends on the conditions of the worldeconomy. As an example, in September 2000, industry analysts predicted a styrene growthrate of 4.6 percent for the next 5 years, with operating rates as high as 99 percent ofcapacity.32 However, the international economic downturn in 2001 resulted in an unforseendecline in demand of 2.6 percent, the first decline in demand in almost 20 years.33 Operatingrates for styrene production declined from 92 percent to 86 percent. Demand decreased tosuch an extent that industry sources estimate that operating rates and consumption volumein this market will not recover until at least 2006.34

Production

Production levels vary in relation to changes in supply and demand. Production levelsincreased irregularly during 1997-2000, from $19.0 billion to $21.3 billion, beforedecreasing to $18.2 billion in 2001. Most of the chemicals followed this trend (see table 3),with the exceptions of terephthalic acid, phenol, and cyclohexane.

As noted previously, half of the domestic terephthalic acid output is used in the productionof PET resins, and these resins continued to maintain their historical annual growth rate of15 percent in 2000.35 As a result, purified terephthalic acid maintained an annual growth rateof 7.4 percent from 1997 through 2000, with a projected rate of 6 percent annually through2004.36 Phenol production reached $1.7 billion in 1997, but ranged between $1.2 and$1.6 billion for the period 1998 through 2001.37 Industry sources state that producers aretrying to keep production levels as low as possible because of high feedstock costs in

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Table 3Organic commodity chemicals: U.S. production, exports of domestic merchandise,1 imports forconsumption,2 and apparent consumption, 1997-2001

(1,000 dollars)Item 1997 1998 1999 2000 2001Ethylbenzene:

Production . . . . . . . . . . . . . . . . . . . . . . . 3,200,000 3,192,500 3,291,500 3,302,500 2,505,560Exports . . . . . . . . . . . . . . . . . . . . . . . . . 32,003 19,227 5,561 18,745 3,758Imports . . . . . . . . . . . . . . . . . . . . . . . . . 1,545 269 54 97 19,129Consumption . . . . . . . . . . . . . . . . . . . . . 3,169,542 3,173,542 3,285,994 3,283,851 2,520,932

Terephthalic acid and its salts:Production . . . . . . . . . . . . . . . . . . . . . . . 1,999,998 1,553,698 1,671,891 2,032,262 2,105,340Exports . . . . . . . . . . . . . . . . . . . . . . . . . 191,064 190,060 144,939 89,492 128,262Imports . . . . . . . . . . . . . . . . . . . . . . . . . 7,613 3,489 10,857 20,481 24,971Consumption . . . . . . . . . . . . . . . . . . . . . 1,816,546 1,367,127 1,537,809 1,963,251 2,002,048

Styrene:Production . . . . . . . . . . . . . . . . . . . . . . . 3,192,000 2,856,500 2,981,500 3,465,500 1,857,473Exports . . . . . . . . . . . . . . . . . . . . . . . . . 391,039 351,068 627,894 922,257 432,977Imports . . . . . . . . . . . . . . . . . . . . . . . . . 173,427 135,127 231,177 482,223 466,679Consumption . . . . . . . . . . . . . . . . . . . . . 2,974,388 2,640,560 2,584,784 3,025,466 1,891,175

para-Xylene:Production . . . . . . . . . . . . . . . . . . . . . . . 1,720,400 1,273,800 1,501,100 2,035,500 1,750,000Exports . . . . . . . . . . . . . . . . . . . . . . . . . 234,965 227,558 260,747 440,708 343,664Imports . . . . . . . . . . . . . . . . . . . . . . . . . 226,199 172,838 138,277 232,310 145,758Consumption . . . . . . . . . . . . . . . . . . . . . 1,711,634 1,219,080 1,378,631 1,827,102 1,552,094

Cumene:Production . . . . . . . . . . . . . . . . . . . . . . . 1,270,500 1,400,700 1,317,840 1,763,000 1,495,887Exports . . . . . . . . . . . . . . . . . . . . . . . . . 44,793 69,482 62,537 123,284 68,371Imports . . . . . . . . . . . . . . . . . . . . . . . . . 188,130 141,985 165,704 265,954 201,185Consumption . . . . . . . . . . . . . . . . . . . . . 1,413,837 1,473,203 1,421,008 1,905,670 1,628,701

Phenol (hydroxybenzene):Production . . . . . . . . . . . . . . . . . . . . . . . 1,704,010 1,555,840 1,182,500 1,515,000 1,431,000Exports . . . . . . . . . . . . . . . . . . . . . . . . . 96,797 108,867 82,512 157,939 171,069Imports . . . . . . . . . . . . . . . . . . . . . . . . . 81,916 82,689 70,319 25,045 7,793Consumption . . . . . . . . . . . . . . . . . . . . . 1,689,129 1,529,662 1,170,307 1,382,106 1,267,725

6-Hexanelactam (epsilon-caprolactam):Production . . . . . . . . . . . . . . . . . . . . . . . 1,222,500 1,260,000 1,216,800 1,332,100 1,224,000Exports . . . . . . . . . . . . . . . . . . . . . . . . . 119,004 108,172 86,205 96,867 98,916Imports . . . . . . . . . . . . . . . . . . . . . . . . . 58,362 52,207 18,582 12,282 6,213Consumption . . . . . . . . . . . . . . . . . . . . . 1,161,858 1,204,035 1,149,177 1,247,515 1,131,297

Cyclohexane:Production . . . . . . . . . . . . . . . . . . . . . . . 487,256 419,566 457,812 516,250 585,000Exports . . . . . . . . . . . . . . . . . . . . . . . . . 58,208 67,304 78,461 137,584 87,343Imports . . . . . . . . . . . . . . . . . . . . . . . . . 25,718 5,452 5,241 526 21,127Consumption . . . . . . . . . . . . . . . . . . . . . 454,766 357,714 384,592 379,192 518,784

All others:Production . . . . . . . . . . . . . . . . . . . . . . . 4,225,376 4,320,826 4,328,869 5,303,220 5,231,380Exports . . . . . . . . . . . . . . . . . . . . . . . . . 115,524 124,540 124,667 159,389 159,972Imports . . . . . . . . . . . . . . . . . . . . . . . . . 159,857 146,601 137,568 161,754 127,927Consumption . . . . . . . . . . . . . . . . . . . . . 4,277,097 4,348,801 4,344,296 5,309,152 5,203,098

Total:Production . . . . . . . . . . . . . . . . . . . . . . . 19,022,040 17,833,430 17,949,812 21,265,332 18,185,640Exports . . . . . . . . . . . . . . . . . . . . . . . . . 1,283,396 1,266,276 1,473,522 2,146,265 1,494,331Imports . . . . . . . . . . . . . . . . . . . . . . . . . 922,767 740,657 777,781 1,200,671 1,020,782Consumption . . . . . . . . . . . . . . . . . . . . . 18,661,411 17,307,811 17,254,071 20,319,738 17,712,091

1 FAS value. 2 Customs value.Source: Based on official statistics from the U.S. Department of Commerce, American Chemistry Council, NationalPetrochemical & Refiners Association, and U.S. International Trade Commission staff estimates.

38 John Hoffman, “Phenol and Acetone Under Pressure,” Chemical Market Reporter, Feb. 19, 2001, p. 3. 39 “Cyclohexane,” Chemical Market Reporter, May 28, 2001, p. 27. 40 William J. Storck, “Productivity Boost For Chemical Firms,” Chemical & Engineering News, Mar. 18,2002, p. 16. 41 “US Chemical Industry Outlook: Trade and Domestic Demand,” p. 33. 42 Ibid. 43 Ibid. 44 John Hoffman, “U.S. Petrochemical Industry Continues to Face Structural Challenges,” ChemicalMarket Reporter, Aug. 13, 2001, p. 22; and T. Kevin Swift and Martha Moore, “US Chemical IndustryOutlook: Trade and Domestic Demand,” p. 33.

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upstream cumene, weak demand, and increased global capacity in 1999 and 2000.38

Although demand for nylon fibers has decreased, demand for nylon resins has increased,creating a balanced market for cyclohexane.39

Worker productivity levels for the organic chemicals industry varied over the 5-year period(table 4). Using a base level of 100 in 1992, productivity ranged a low of 104.4 in 1998 toa high of 120.1 in 2000 before declining to 106.4 in 2001. The decrease from 2000 to 2001resulted primarily from a 14.5-percent decrease in production, despite only a 2.5-percentreduction in production employment levels.40

The basic feedstocks and energy source for production of the organic commodity chemicalsinclude naphtha and natural gas. Whereas natural gas historically has been the lower pricedfeedstock for domestic industries, with supplies readily available, many foreign producersrely on naphtha, or crude petroleum, as a feedstock. For example, 70 percent of domesticethylene producers have the ability to use natural gas; in comparison, 70 percent of foreignproducers utilize naphtha.41 Although prices for both are variable, industry sources state thatnatural gas historically has been a relatively less expensive domestic feedstock, allowingU.S. producers a competitive advantage in world markets.42 However, since 1997, therelative price of natural gas has increased compared to that of crude petroleum (table 5).Higher natural gas feedstock prices reportedly have made the domestic gulf coast-basedproducers less competitive than producers that use naphtha.43 In addition, the economicdownturn in many of the world markets has reduced, or at least slowed, the growth rate ofglobal demand for organic commodity chemicals. Because of high feedstock costs, slowingdemand, and overseas competition, domestic producers have faced a challengingenvironment in recent years.44

45 Patricia Short, “Europe’s Nexus,” Chemical & Engineering News, May 28, 2001, p. 18.

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Table 4Organic commodity chemicals: productivity and unit labor costs, 1997-2001

(1992=100)

Item 1997 1998 1999 2000 2001All manufacturing:

Productivity . . . . . . . . . . . . . . . . . . . . . . 121.8 129.5 137.1 145.4 150.3Unit labor costs . . . . . . . . . . . . . . . . . . . 94.3 90.9 88.4 86.3 86.1

Organic chemicals:Productivity . . . . . . . . . . . . . . . . . . . . . . 113.1 104.4 114.6 120.1 106.4Unit labor costs . . . . . . . . . . . . . . . . . . . 101.6 113.6 105.2 105.0 119.1

Source: “Productivity Boost For Chemical Firms,” Chemical & Engineering News, Mar. 18, 2002.

Table 5Relative price history of crude petroleum and natural gas, 1987-2001

Average for1987-1996 1997 1998 1999 2000 2001

Crude petroleum annual average price1 . . . . . . . . . . . . . . . . . . . . . . . .

15.69 17.23 10.87 15.56 26.72 22.35

Natural gas annual average price 2 . . . . 1.77 2.32 1.96 2.19 3.68 4.27Ratio of crude petroleum price to

natural gas price . . . . . . . . . . . . . . .

8.9 7.4 5.5 7.1 7.3 5.2 1 Price is in dollars per barrel, domestic first purchase price. 2

Price is dollars per thousand cubic feet, wellhead price.Source: Energy Information Administration, Monthly Energy Review.

U.S. TRADE

Overview

Trade in organic commodity chemicals is intrinsic in today’s global marketplace. Becausethese chemicals are usually transported by ship, proximity to a deep water port is said to bea major determinant in the ability of producers in a given region to compete. For example,the United States ships most imports and exports through Houston, while northern Europeprimarily uses Rotterdam and Antwerp.45 From these and other ports worldwide, truck andrail are used to transport product to and from manufacturing plants.

46 John Hoffman, “Styrene Demand and Prices Remain Weak,” Chemical Market Reporter, Sept. 10,2001, p. 1. 47 Ibid. 48 “CMAI Publishes Results of 2002 World Styrene Analysis,” PRNewswire, Dec. 28, 2001.

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The domestic organic commodity chemicals industry maintained a positive net trade balancethroughout the period 1997-2001, increasing from $361 million in 1997 to $946 million in2000, before declining to $474 million in 2001. A significant part of this variation reflectsthe trade balance in styrene. The styrene trade balance increased from $218 million in 1997to $440 million in 2000, only to decrease to a negative trade balance of $34 million in 2001.Although the styrene market averaged 4 percent annual growth through 1999, industrysources estimated a 10-percent decline in demand in 2001.46 Polystyrene demand, whichaccounts for two-thirds of styrene demand, slowed in the second half of 2000 to match theslowdown in the domestic economy.47 Some analysts suggest, however, that styrene demandin 2000 was artificially high, and demand in 2001 was artificially low because of buildupsin inventory in 2000 and subsequent depletions in 2001.48 Table 6 shows the trade balancefor several major commodity chemicals.

Table 6Trade balance of certain commodity chemicals, 1997-2001

(1,000 dollars)

Item 1997 1998 1999 2000 2001para-Xylene . . . . . . . . . . . . . . . . . . . . . . . . 100,050 105,203 130,228 209,354 197,904Phenol (hydroxybenzene) . . . . . . . . . . . . . . 5,588 12,364 4,057 111,611 145,884Terephthalic acid and its salts . . . . . . . . . . . 192,805 190,681 134,307 69,947 124,2426-Hexanelactam (epsilon-

caprolactam) . . . . . . . . . . . . . . . . . 60,640 55,963 67,623 84,584 92,705Cyclohexane . . . . . . . . . . . . . . . . . . . . . . . . 32,489 61,852 73,221 137,056 66,216Aniline and its salts . . . . . . . . . . . . . . . . . . . (11,027) (516) 3,346 13,056 12,310meta-Xylene . . . . . . . . . . . . . . . . . . . . . . . . (7,168) 20,303 16,915 18,120 10,908Phthalic anhydride . . . . . . . . . . . . . . . . . . . 5,568 3,766 6,619 6,867 7,803Dicyclopentadiene and other cyclanes,

cyclenes, and cycloterpenes . . . . . 11,506 (3,934) (17,976) (4,840) 6,545Cyclohexanol, methylcyclo-

hexanols and dimethylcyclo-hexanols . . . . . . . . . . . . . . . . . . . . (8,415) (4,988) (4,451) (968) 700

Dodecylbenzene . . . . . . . . . . . . . . . . . . . . . (737) (2,649) (3,053) (3,133) (3,669)Dimethyl terephthalate . . . . . . . . . . . . . . . . 3,102 3,541 918 835 (3,722)ortho-Xylene . . . . . . . . . . . . . . . . . . . . . . . . (31,940) (37,899) (35,245) (26,300) (13,445)Ethylbenzene . . . . . . . . . . . . . . . . . . . . . . . 30,457 18,959 5,508 18,650 (15,373)Styrene . . . . . . . . . . . . . . . . . . . . . . . . . . . . 217,611 215,941 396,716 440,034 (33,701)Source: Compiled from official statistics of the U.S. Department of Commerce.

49 “Cumene,” Chemical Week, Mar. 20, 2002, p. 47. 50 Nigerian exports from 1997 through 2000 ranged from $65 million to $127 million.

17

U.S. Imports

Principal Suppliers and Import Levels

U.S. imports of organic commodity chemicals increased irregularly during 1997-2001, from$923 million in 1997 to $1.2 billion in 2000, before declining to $1.0 billion in 2001. Theprincipal organic commodity chemicals imported into the United States during this period,based on value, were styrene, cumene, and para-xylene. Together, these three productsaccounted for 72 percent of the imported organic commodity chemicals during 1997-2001.

Styrene imports account for a significant portion of the fluctuation in the overall importlevels of the organic commodity chemicals. Styrene imports grew from $173 million in 1997to $482 million in 2000 before declining to $467 million in 2001. Cumene mirrored theoverall import level fluctuations, increasing irregularly from $188 million in 1997 to$266 million in 2000, before declining to $201 million in 2001. Phenol production, whichaccounts for 95 percent of cumene demand, experienced a significant decline in demand in2001.49

The primary suppliers of U.S. organic commodity chemical imports were Canada,Venezuela, Saudi Arabia and Nigeria, all countries with domestic reserves of crudepetroleum. Canada exported $514 million of these goods in 2001 to the United States,$462 million of which was styrene. Venezuela exported $83 million, including $47 millionin cumene and $21 million in para-xylene. Saudi Arabia exported $81 million, $40 millionof which was para-xylene. Nigeria exported $21 million in 2001, $13 million of which wascumene.50 Combined, these four countries contributed a minimum of 51 percent ofU.S. imports of these products in 1997 to a maximum of 70 percent of imports in 2000. Seetable B-1 for a list of imports by country.

Tariff and Nontariff Measures

Table 7 shows the tariff rates of duty as of January 1, 2002, for imports of the organiccommodity chemicals under the Harmonized Tariff Schedule (HTS) of the United States.The United States currently has zero tariffs on eight of the organic commodity chemicalsimported from countries with normal trade relations status; these eight products accountedfor 87 percent of imports of organic commodity chemicals in 2001. Eligible imports fromCanada, which accounted for 50 percent of organic commodity chemical imports in 2001,enter the United States duty free under the North American Free Trade Agreement(NAFTA). Eligible goods from Venezuela and Nigeria, accounting for 8.1 percent and2.1 percent respectively of 2001 U.S. imports of these products, enter duty free under theGeneralized System of Preferences. Saudi Arabia supplied 7.9 percent of U.S. imports of

Table 7Organic commodity chemicals: Harmonized Tariff Schedule subheading; description; U.S. column 1, Special, and column 2 rates of duty as of Jan. 1,2002; U.S. imports, 2001; and U.S. exports, 2001

HTS Description

Column 1 rate of duty as ofJan. 1, 2002–

Special

Column 2 rate of duty as of Jan. 1, 2002–

U.S.imports,

2001 U.S. exports,

2001General

AVE forCompoundRates

–––– 1,000 dollars –––––

2902.11.00 Cyclohexane . . . . . . . . . . . . . . . . . . . . 0.4¢/kg + 2.5% 3.48% Free (A*, CA, E, IL, J, MX)

15.4¢/kg + 40% 21,127 87,343

2902.19.00 Cyclanic hydrocarbons (exceptcyclohexane), cyclenic hydro-carbons and cycloterpenes . . . . . . Free 25% 27,458 34,003

2902.41.00 o-Xylene . . . . . . . . . . . . . . . . . . . . . . . Free Free 37,348 23,9032902.42.00 m-Xylene . . . . . . . . . . . . . . . . . . . . . . . Free Free 3,808 14,7162902.43.00 p-Xylene . . . . . . . . . . . . . . . . . . . . . . . Free Free 145,759 343,6632902.50.00 Styrene . . . . . . . . . . . . . . . . . . . . . . . . Free 15.4¢/kg + 45% 466,678 432,9772902.60.00 Ethylbenzene . . . . . . . . . . . . . . . . . . . 0.2¢/kg +3.5% 3.89% Free (A*, CA, E, IL, J)

0.1¢/kg +1.7% (MX)15.4¢/kg + 55% 19,129 3,756

2902.70.00 Cumene . . . . . . . . . . . . . . . . . . . . . . . Free Free 201,184 68,3712902.90.10 Pseudocumene . . . . . . . . . . . . . . . . . . Free Free 2,867 (1)2902.90.20 Acenaphthene, chrysene, cymene,

dimethylnaphthalenes,fluoranthene, fluorene, indene,mesitylene, and other specifiedcyclic hydrocarbons . . . . . . . . . . . . . Free Free 7,173 (1)

2902.90.30 Alkylbenzenes and polyalkyl-benzenes . . . . . . . . . . . . . . . . . . . . 0.2¢/kg + 3.5% 3.78% Free (A+, CA, D, E, IL,

J) 0.1¢/kg +1.7% (MX)15.4¢/kg + 55% 4,156 34,691

2902.90.40 Anthracene and 1,4-di-(2-methylstyryl)benzene . . . . . . . . . . . . . 2.1% Free (A*, CA, E, IL, J)

1% (MX)15.4¢/kg + 68.5% 26 (1)

2902.90.60 Biphenyl (diphenyl), in flakes . . . . . . . 2.1% Free (A*, CA, E, IL, J) 15.4¢/kg + 68.5% 169 (1)2902.90.90 Cyclic hydrocarbons, nesoi . . . . . . . . . 2.1% Free (A+, CA, D, E, IL,

J, K) 1% (MX)15.4¢/kg + 68.5% 29,341 (1)

See footnote at end of table.

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Table 7–ContinuedOrganic commodity chemicals: Harmonized Tariff Schedule subheading; description; U.S. column 1, Special, and column 2 rates of duty as of Jan. 1,2002; U.S. imports, 2001; and U.S. exports, 2001

HTS Description

Column 1 rate of duty as ofJan. 1, 2002–

Special Column 2

U.S.imports,

2001 U.S. exports,

2001General

AVE forCompoundRates

––––– 1,000 dollars –––––

2906.12.00 Cyclohexanol, methylcyclohexanolsand dimethylcyclohexanols- . . . . . . 0.7¢/kg + 7.8% 7.80% Free (A+, CA, D,

E, IL, J, MX)0.9¢/kg + 6% (JO)

15.4¢/kg + 53.5% 19 719

2907.11.00 Phenol (hydroxybenzene) and its salts 5.5% Free (A*, CA, E, IL,J, MX) 2.7% (JO)

15.4¢/kg + 44% 7,793 153,677

2917.35.00 Phthalic anhydride . . . . . . . . . . . . . . . 0.5¢/kg + 6.9% 7.76% Free (A*, CA, E, IL, J, K, MX) 0.5¢/kg + 3.6% (JO)

15.4¢/kg + 49% 7,353 15,156

2917.36.00 Terephthalic acid and its salts . . . . . . 0.7¢/kg + 8.8% 16.24% Free (A+, CA, D, E, IL, J) 0.3¢/kg +1.7% (MX) 0.5¢/kg + 3.6% (JO)

15.4¢/kg + 57% 4,019 128,261

2917.37.00 Dimethyl terephthalate . . . . . . . . . . . . 0.6¢/kg + 7.8% 7.99% Free (A*, CA, E, IL, J, MX) 0.7¢/kg +5.4% (JO)

15.4¢/kg + 42% 5,672 1,950

2921.41.10 Aniline . . . . . . . . . . . . . . . . . . . . . . . . 0.7¢/kg + 7.9% 9.37% Free (A+, CA, D, E, IL, J) 0.3¢/kg +1.3% (MX)

0.9¢/kg + 5.5% (JO)

15.4¢/kg + 43.5% 2,516 (1)

2921.41.20 Aniline salts . . . . . . . . . . . . . . . . . . . . 0.5¢/kg + 9% 9.04% Free (A+, CA, D, E, IL, J) 0.2¢/kg +1.8% (MX) 0.6¢/kg + 6.8% (JO)

15.4¢/kg + 60% 14 (1)

2933.71.00 6-Hexanelactam (epsilon-caprolactam) 0.7¢/kg + 7.2% 7.83% Free (A*, CA, E, IL, J, MX) 0.6¢/kg +3.9% (JO)

15.4¢/kg + 40% 6,212 98,917

1 Official statistics for U.S. exports of the products classified under this HTS subheading are not collected at a similar level of aggregation.

Programs under which special tariff treatment may be provided and the corresponding symbols for such programs as they are indicated in the “Special” subcolumnare as follows: Generalized System of Preferences (A or A*); North American Free Trade Agreement, eligible goods of Canada (CA); African Growth andOpportunity Act (D); Caribbean Basin Economic Recovery Act (E); United States-Israel Free Trade Agreement (IL); the Andean Trade Preference Act (J); UnitedStates-Jordan Free Trade Area Implementation Act (JO); Agreement on Trade in Pharmaceutical Products (K); and the North American Free Trade Agreement,eligible goods of Mexico (MX).

Source: Harmonized Tariff Schedule of the United States. U.S. import and export data compiled from official statistics of the U.S. Department of Commerce.

19

51 Based on Commission telephone conversations with industry sources.

20

these products in 2001, although products with zero tariffs accounted for 97 percent of theseimports, including para-xylene, cumene, and styrene. No nontariff measures restrictingimports have been reported to Commission staff.

U.S. Government Trade-Related Investigations

During the period 1997 through 2001, there were no trade investigations conducted by theCommission on any of the organic commodity chemicals addressed in this report.

U.S. Exports

Because of the establishment of specific grade and purity levels, the organic commoditychemicals are of uniform quality and move in a global market. As a result, export levels canfluctuate because of a variety of factors, including the choice of feedstock and currencyvaluations. As previously mentioned, because U.S. producers can avail themselves of lowercost natural gas, U.S. commodity chemicals often are priced competitively, making themattractive internationally. However, because of the relatively strong valuation of theU.S. dollar in recent years, domestic producers reportedly have found it more difficult toexport goods in a profitable manner.51

51 Simon Webb, “Pemex Shake-up,” Business Mexico, Apr. 2001, p. 26. 52 Robert Westervelt and Kara Sissel, “Pemex to Invest $1 Billion in Petchems,” Chemical Week, Apr. 3,2002, p. 9. 53 Malini Hariharan, “Looking Up,” Chemical Market Reporter, May 22, 2000, p. 45. 54 Ibid.

21

Principal Markets and Export LevelsTotal U.S. exports of organic commodity chemicals increased from $1.28 billion in 1997 toa high of $2.15 billion in 2000 and then decreased to $1.49 billion in 2001. The four largestU.S. export markets for these products in 2001 were Mexico (35 percent of exports), Canada(21 percent), Taiwan (9 percent), and the Netherlands (6 percent). From 1997 through 2001,these four countries accounted for 63 to 70 percent of U.S. exports of organic commoditychemicals. The two largest organic commodity chemical exports were styrene and para-xylene, which together accounted for 55 percent of all exports of commodity chemicals inthe period 1997-2001.

Mexico accounted for 42 percent of U.S. styrene exports in 2001. Although the countrypossesses indigenous stores of crude petroleum, the Mexican Government has recognizedthe need to increase efficiency and productivity within Petroleos Mexicanos (Pemex), thestate-owned crude petroleum producer.51 For example, Pemex Petroquimica president RafaelBeverido Lomelin cited the need to improve Pemex’s cost structure in order to reduceMexico’s dependency on chemical imports.52

Asia has also been a large market for U.S. exports of these products. For example, strongpolyester demand in Asia contributed to U.S. para-xylene exports to this region in the past.Increased Asian production capacity and decreasing global polyester demand, however, mayaffect the future trade balance of this chemical.53 See table B-2 for a list of exports bycountry.

Foreign Trade Measures

In general, duty rates on the organic commodity chemicals worldwide are low or free. UnderNAFTA, qualifying U.S. exports enter Canada and Mexico free of duty. The EuropeanUnion (EU) has no tariffs for cyclohexane, styrene, xylene isomers, cumene, orethylbenzene. The remainder of the organic commodity chemicals entering the EU aredutiable at rates ranging from 3.0 to 8.5 percent. Japan’s duty rates for the major organiccommodity chemicals for World Trade Organization (WTO) members range from free to5.3 percent. In 2001, China maintained rates of 6 to 14 percent for their “normal traderelations” partners, and rates of 20 to 30 percent for other countries. However, the ChineseGovernment, under its WTO accession agreement, has committed to lowering chemicaltariffs to 6.9 percent by 2004.54 Taiwan currently imposes tariff rates of 5 percent or less onmost organic commodity imports.

55 Neil Franz, “Huge Chemical Markets Hinge on WTO Decisions,” Chemical Week, Dec. 1, 1999, p. 50. 56 Sean Milmo, “European Chem Industry Is Wary of Trade Talks,” Chemical Market Reporter, Nov. 29,1999, p. 6. 57 Ibid. 58 Canadian Chemical Producers Association, “Think Investment - Chemicals,” Oct. 29, 1999. 59 Trade balances are based on official statistics of the U.S. Department of Commerce for the HTSnumbers at the six-digit level of the chemicals covered in this report. Imports are imports for consumptionvalue and exports are domestic exports FAS value. 60 Based on official statistics of the U.S. Department of Commerce, U.S. imports from Canada averaged276 million kilograms of styrene in 1997-1998 and 505 million kilograms between 1999-2001. The customsunit value per first unit of quantity averaged $0.527 per kilogram in 1997-1998 and $0.748 between 1999-2001. 61 Peter Fairley, “Canadian Chemicals: Running on Empty,” Chemical Week, July 19, 2000, p. 20.

22

In the Uruguay Round of trade negotiations, the Chemical Tariff Harmonization Agreement(CTHA) was developed, which would reduce maximum chemical tariffs to levels between5.5 and 6.5 percent.55 North America, Europe and Japan have committed to eliminatingchemical tariffs by 2010, but with the condition that all other WTO members make similarcommitments, even if such a commitment is phased in over a longer period of time.56

Countries that have not agreed to the CTHA account for approximately 30 percent ofworldwide chemical production, including Argentina, Brazil, Malaysia, and Venezuela.These countries appear to want similar agreements in textiles and agriculture before agreeingto the chemicals proposal.57

FOREIGN INDUSTRY PROFILEMajor producers of the organic commodity chemicals typically are located either near largesources of crude petroleum or near major markets of industrialized and rapidlyindustrializing nations. As a result, the dominant countries in this market are in NorthAmerica, western Europe, and the Asian rim. The members of the Organization of PetroleumExporting Countries (OPEC) are also major producers.

North America

The Canadian organic chemicals industry depends on large petroleum reserves in Albertaand Saskatchewan and is an export-oriented industry. The Canadian Chemical ProducersAssociation reported that 55 percent of chemical gross output was exported in 1998.58 A newset of production facilities in 2000 was designed for 80 percent of the output to be exported,primarily to the United States and Southeast Asia. The organic commodity chemicals tradedeficit with Canada was $20.7 million in 1997 and $201 million in 2001.59 U.S. styreneimports from Canada ranged from $170 million in 1997 to $223 million in 1999. However,these imports increased to $449 million in 2000 and $462 million in 2001. This increase isa result of both increased volume and higher unit values.60 Canadian ethane feedstock costsrose in 1999 and 2000, but this increase was less than the increase of U.S. gulf coast ethane,increasing the Canadian producers’ competitiveness versus that of the U.S. producers.61

62 “Pemex Teeters on the Edge,” Chemical Market Reporter, Mar. 25, 2002, p. N27. 63 Ibid. 64 Webb,“Pemex Shake-up,” p.26. 65 Ibid; “Pemex Teeters on the Edge,” p. N27. 66 Webb, “Pemex Shake-up,” p. 26. 67 Natasha Alperowicz, “Asia Still Offers the Most Growth,” Chemical Week, Mar. 20, 2002, p. 34. 68 Eleanor Van Savage, “Asia Petrochemical Industry Faces Challenges in 2001 and Beyond,” ChemicalMarket Reporter, Jan. 1, 2001, p. 4. 69 Sigmund Floyd, “Cracking the Chemical Sector,” China Business Review, Mar./Apr. 2002, p. 32. 70 Ibid. 71 Malini Hariharan, “Pull and Push of the West,” Chemical Market Reporter, May 28, 2001, p. S54. 72 “Styrene Industry to Recover After Dismal 2001,” Oil & Gas Journal, Feb. 4, 2002, p. 52. As noted inthe article, however, some of this growth may have been a result of improved record-keeping of imports andimproved antismuggling efforts, rather than actual increase in demand. 73 Ibid.

23

Between 1997 and 2001, the trade surplus in organic commodity chemicals with Mexicoincreased 214 percent from $159 million to $499 million. A significant portion of thisincrease resulted from increased exports of para-xylene (from $113 million in 1997 to$252 million in 2001) and styrene ($78 million in 1997 to $182 million in 2002). Despiteample crude petroleum resources, Mexican petrochemical production has declined in recentyears and Mexico faces the possibility of becoming a net importer of these goods in the nearfuture.62 The dominant producer in this market is Pemex, a national petroleum monopoly,which varies between the third- and fifth-largest petroleum producer globally, depending onoutput fluctuations. According to industry sources, Mexico’s President, Vicente Fox, hasmade it clear that there are no plans currently in place to privatize Pemex,63 but he wishesto improve the company’s competitiveness.64 These sources report that this will necessitateincreasing the company’s efficiency and productivity through various means, including fiscalreform.65 Currently, for example, profits are returned to Mexico’s Government, andreinvestment capital is distributed in annual budgets by the Mexican Government, reportedlyresulting in little incentive for the company to operate in an efficient and profitable manner.66

Asia

Asian Pacific countries currently account for one-third of global chemical consumption, butindustry sources predict this level will increase to one-half in the future.67 Capacity increasescoming onstream between 1998 and 2010, however, may satisfy some of the increaseddemand in the region. Multi-national corporations, including Shell, BP, BASF, and Dow,have invested in petrochemical projects in this region.68

With China’s entrance into the WTO in November 2001, the increased availability ofChinese markets has major producers worldwide expressing interest.69 The planned removalof reported de facto trade barriers, including restrictions on import, resale, and distributionby existing foreign ventures, and the lowering of import tariffs are designed to open marketsto foreign producers.70 Chemical Market Associates, Inc., (CMAI) estimates that China’sshare of the world styrene market by weight grew from 2 percent in 1994-1995 toapproximately 8 percent in 1999-2000.71 In 2001, China’s styrene demand continued togrow, increasing 22 percent (by weight), despite a decline in world styrene demand of2.6 percent.72 The country is expected to account for 11 percent of the world’s styreneconsumption by weight in 2003, exceeding Asian production capacity by 1.2 million tons($612 million based on 5-year average domestic price).73

74 Ian Young, “China Launches Probe Into Alleged Caprolactam Dumping,” Chemical Week, Dec. 19-26,2001, p. 16. 75 John Richardson, “Some Spots Brighten Up for Asian Petrochemicals,” Chemical Market Reporter,Jan. 21, 2002, p. 9. 76 Andrew Wood, “Free Trade Secrets,” Chemical Week, Aug. 23, 2000, p. 3. 77 Malini Hariharan, “Crossroads,” Chemical Market Reporter, May 28, 2001, p. S48. 78 Richardson, “Some Spots Brighten Up For Asian Petrochemicals,” p. 9. 79 Stephen Moore, “Fighting the Tide: a Big Buildup in Singapore,” Chemical Week, Feb. 6, 2002, p. 21. 80 Ibid. 81 “Annus Horribilis,” Chemical Market Reporter, Mar. 25, 2002, p. N29. 82 “Japanese Chemical Industry Turning to China Market,” Asiainfo Daily China News, Mar. 19, 2002.

24

With China’s average tariffs on chemical imports dropping from 14.7 percent to 6.9 percent,imports of $30.2 billion in chemicals in 2000,74 and a predicted GNP growth rate of7.6 percent in 2002,75 organic commodity chemicals producers worldwide are reportedlyexamining the Chinese market closely for opportunities. One estimate by the AmericanChemical Council shows an increase in U.S. exports to China of more than $300 million inthe initial years following China’s accession to the WTO.76 The U.S. organic commoditychemicals trade balance with China has irregularly increased from $7.9 million in 1997 to$11.5 million in 2001.

Taiwan has built several organic commodity chemicals production facilities in recent years.As these plants have come online, U.S. exports of these goods to Taiwan have decreased. In1999, U.S. exports of organic commodity chemicals to Taiwan were $239 million,16 percent of total U.S. exports of these goods. In 2001, exports were $135 million,accounting for 9 percent of exports. In 2000, Formosa Chemicals and Fibre Corporationbegan production in a new aromatics plant capable of annual output of 450,000 metric tonsof para-xylene, 100,000 metric tons of ortho-xylene, 200,000 metric tons of phenol, and250,000 tons of styrene.77 Taiwan was accepted into the WTO in 2001 with China, butindustry sources do not predict major changes from Taiwan’s entry. A decline of 2.5 percentin Taiwan’s GDP in 200178 may have slowed the domestic demand for the organiccommodity chemicals as well. The U.S. trade balance with Taiwan was $183 million in 1997and $134 million in 2001.

According to industry sources, Singapore has attracted significant foreign investmentbecause of its stable government and probusiness environment, despite a lack of domesticfeedstocks.79 Without a substantial home market, however, production is largely export-dominated and is dictated primarily by world demand for these goods.80 The U.S. tradebalance with Singapore for these products increased irregularly from $94 thousand in 1997to $10 million in 2000, before declining to $2.7 million in 2001.

Japan has reportedly never concentrated on an export market, using only marginal tonnagefor exports.81 However, because of stagnant growth domestically, Japanese producers aresaid to be exploring export opportunities, especially to China and other Asian countries.82

The U.S. trade deficit with Japan in these products declined from $58.4 million in 1997 to$17.7 million in 2001.

83 “European Petrochemicals Industry Appears in Need of Further Rationalization,” Chemical MarketReporter, Feb. 25, 2002, p. 9. 84 Ibid. 85 “Europeans Question Impact of Major Petrochem Expansions in Middle East,” Chemical MarketReporter, June 18, 2001, p. 6. 86 “Facing Competition,” Chemical Market Reporter, Mar. 25, 2002, p. N33. 87 “Europeans Question Impact of Major Petrochem Expansions in Middle East,” p. 6. 88 “Facing Competition,” Chemical Market Reporter, Mar. 25, 2002, p. N33. 89 Mike Corkhill, “Moving More Efficiently,” Chemical Week, Sept. 29, 1999, p. S56. 90 Ibid. 91 Ibid.

25

Europe

The European petrochemical industry has recently faced poor margins, excess capacity, andweak demand growth.83 In addition, according to a CMAI analyst, current investment levelsin the Middle East petrochemicals industry are “a major factor stopping anyone putting anymoney on the table for European expansions at the moment.”84 With an estimated 7 millionmetric tons per year of ethylene production coming on stream between 2005 and 2010 inthe Middle East, industry sources state that it is likely that substantial amounts of this outputwill be exported to Europe.85

The two major determinants in plant location are access to feedstocks and proximity togrowth markets. The European market for organic commodity chemicals is extremelycompetitive, with very low margins. As a result, there are very few new facilities beingconstructed in the area beyond 2004.86 European producers, including BP, Shell, andTotalFinaElf, are entering into strategic alliances in the Middle East, especially Saudi Arabiaand Iran, rather than building new facilities in Europe.87 Industry sources predict continuedrestructuring and rationalization in European production, supported by indications fromproducers DSM and Eni that they are looking to divest their European petrochemicalsactivities.88

The European transportation infrastructure has been described as operating with less-than-optimal efficiency.89 For example, the rail infrastructure, built prior to European unification,contains 15 different nationalized railroads. The majority of European chemical shipmentstravel by road (88 percent); the remainder are shipped by waterway (4 percent) and by rail(7 percent). In contrast, 56 percent of U.S. shipments travel by road, 15 percent by waterway,and 29 percent by rail.90 The European Chemical Industry Council is seeking to increasetransportation efficiency by increasing use of rail and waterways.91

92 Ibid. 93 Sean Milmo, “Russia Emerges as a Potential Power in European Chemicals,” Chemical MarketReporter, Mar. 26, 2001, p. FR6. 94 Ibid. 95 Ibid. 96 Ibid. 97 Ibid. 98 Natasha Alperowicz, “Sibur: A New Power in the East,” Chemical Week, Aug. 1, 2001, p. 45. 99 Ibid. 100 Ibid.

26

Middle East

The Middle Eastern members of OPEC include Iran, Iraq, Kuwait, Saudi Arabia, the UnitedArab Emirates, and Qatar. Each of these countries possesses significant crude petroleumreserves. As a result, it is economically advantageous to base production of the organiccommodity chemicals near these reserves. Proximity minimizes transportation costs anddelays and permits vertical integration and reliable access to feedstocks. This area receivedlarge influxes of capital investment recently by foreign multinationals such as BP,ExxonMobil, and Shell, especially during the period 2000-2001.92 These new facilities, inaddition to new production facilities in the Asia/Pacific area, have contributed to significantincreases in worldwide capacity.

Others

According to industry sources, Russia has the potential to become an important factor in theinternational chemicals marketplace.93 This region has only recently raised production levelsback to the levels of the 1980s.94 However, Russia possesses lower cost and reliablefeedstocks and generally incurs lower labor costs, which, under certain circumstances, aresaid to be as low as 10 percent of labor costs in Western Europe.95 Industry sources state thatthe two largest Russian petroleum and natural gas producers, Lukoil and Gazprom, havebegun integration efforts from crude petroleum exploration to aromatics production.96 Withstrict government controls on energy prices, these firms have turned to the manufacture andprocessing of downstream products in order to maximize profits.97 Gazprom currently ownsa 51-percent interest in the Siberian-Ural Petrochemical and Gas Company (Sibur), thelargest petrochemical group in Russia.98 Although its plants are based primarily ontechnology from the 1970s and 1980s, Sibur is negotiating a joint venture with BASF andplans an initial public offering on the New York Stock exchange in 2004.99 According tocompany president Yakov Goldovskii, Sibur aims to become a leading petrochemicals playerin Central and Eastern Europe, with eventual plans of expanding into Asia.100

APPENDIX AEXPLANATION OF TARIFF AND TRADEAGREEMENT TERMS

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APPENDIX ATARIFF AND TRADE AGREEMENTTERMS

In the Harmonized Tariff Schedule of the United States (HTS), chapters 1through 97 coverall goods in trade and incorporate in the tariff nomenclature the internationally adoptedHarmonized Commodity Description and Coding System through the 6-digit level of productdescription. Subordinate 8-digit product subdivisions, either enacted by Congress orproclaimed by the President, allow more narrowly applicable duty rates; 10-digitadministrative statistical reporting numbers provide data of national interest. Chapters 98 and99 contain special U.S. classifications and temporary rate provisions, respectively. The HTSreplaced the Tariff Schedules of the United States (TSUS) effective January 1, 1989.

Duty rates in the general subcolumn of HTS column 1 are normal trade relations rates; manygeneral rates have been eliminated or are being reduced due to concessions resulting fromthe Uruguay Round of Multilateral Trade Negotiations. Column 1-general duty rates applyto all countries except those listed in HTS general note 3(b) (Cuba, Laos, and North Korea)plus Serbia and Montenegro, which are subject to the statutory rates set forth in column 2.Specified goods from designated general-rate countries may be eligible for reduced rates ofduty or duty-free entry under preferential tariff programs, as set forth in the specialsubcolumn of HTS rate of duty column 1 or in the general notes. If eligibility for specialtariff rates is not claimed or established, goods are dutiable at column 1-general rates. TheHTS does not list countries covered by a total or partial embargo.

The Generalized System of Preferences (GSP) affords nonreciprocal tariff preferences todesignated beneficiary developing countries. The U.S. GSP, enacted in title V of the TradeAct of 1974 for 10 years and extended several times thereafter, applies to merchandiseimported on or after January 1, 1976, and before the close of December 31, 2006. Indicatedby the symbol "A", "A*", or "A+" in the special subcolumn, GSP provides duty-free entryto eligible articles the product of and imported directly from designated beneficiarydeveloping countries (see HTS gen. note 4). Eligible products of listed sub-Saharan Africancountries may qualify for duty-free entry under the African Growth and Opportunity Act(AGOA) (see HTS gen. note 16) through September 30, 2008, as indicated by the symbol“D” in the special subcolumn; see subchapter XIX of chapter 98.

The Caribbean Basin Economic Recovery Act (CBERA) affords nonreciprocal tariffpreferences to designated Caribbean Basin developing countries. The CBERA, enacted intitle II of Public Law 98-67, implemented by Presidential Proclamation 5133 of November30, 1983, and amended by the Customs and Trade Act of 1990, applies to goods entered, orwithdrawn from warehouse for consumption, on or after January 1, 1984. Indicated by thesymbol "E" or "E*" in the special subcolumn, CBERA provides duty-free entry to eligiblearticles, and reduced-duty treatment to certain other articles, which are the product of andimported directly from designated countries (see HTS gen. note 7). Eligible products oflisted beneficiary countries may qualify for duty-free or reduced-duty entry under the

A-3

Caribbean Basin Trade Partnership Act (CBTPA) (see HTS gen. note 17), throughSeptember 30, 2008, as indicated by the symbol “R” in the special subcolumn; seesubchapter XX of chapter 98.

Free rates of duty in the special subcolumn followed by the symbol "IL" areapplicable to products of Israel under the United States-Israel Free Trade AreaImplementation Act of 1985 (IFTA), as provided in general note 8 to the HTS; seealso subchapter VIII of chapter 99.

Preferential nonreciprocal duty-free treatment in the special subcolumn followed by thesymbol "J" or "J*" in parentheses is afforded to eligible articles from designated beneficiarycountries under the Andean Trade Preference Act (ATPA), enacted as title II of Public Law102-182 (effective July 22, 1992; see HTS gen. note 11) and renewed through December 31,2006, by the Andean Trade Promotion and Drug Eradication Act of 2002.

Preferential free rates of duty in the special subcolumn followed by the symbol "CA" areapplicable to eligible goods of Canada, and rates followed by the symbol "MX" areapplicable to eligible goods of Mexico, under the North American Free Trade Agreement(NAFTA), as provided in general note 12 to the HTS and implemented effective January 1,1994, by Presidential Proclamation 6641 of December 15, 1993. Goods must originate inthe NAFTA region under rules set forth in general note 12(t) and meet other requirementsof the note and applicable regulations.

Preferential rates of duty in the special subcolumn followed by the symbol “JO” areapplicable to eligible goods of Jordan under the United States-Jordan Free Trade AreaImplementation Act, (JFTA) effective as of Dec. 17, 2001; see HTS gen. note 18 andsubchapter IX of chapter 99.

Other special tariff treatment applies to particular products of insular possessions (gen. note3(a)(iv)), products of the West Bank and Gaza Strip (gen. note 3(a)(v)), goods covered bythe Automotive Products Trade Act (APTA) (gen. note 5) and the Agreement on Trade inCivil Aircraft (ATCA) (gen. note 6), articles imported from freely associated states (gen.note 10), pharmaceutical products (gen. note 13), and intermediate chemicals for dyes (gen.note 14).

The General Agreement on Tariffs and Trade 1994 (GATT 1994), pursuant to theAgreement Establishing the World Trade Organization, is based upon the earlier GATT 1947(61 Stat. (pt. 5) A58; 8 UST (pt. 2) 1786) as the primary multilateral system of discipline andprinciples governing international trade. The agreements mandate most-favored-nationtreatment, maintenance of scheduled concession rates of duty, and national treatment forimported goods; GATT provides the legal framework for customs valuation standards,"escape clause" (emergency) actions, antidumping and countervailing duties, disputesettlement, and other measures. Results of the Uruguay Round of multilateral tariffnegotiations are set forth in separate schedules of concessions for each participatingcontracting party, with the U.S. schedule designated as Schedule XX. Pursuant to theAgreement on Textiles and Clothing (ATC) of the GATT 1994, member countries arephasing out restrictions on imports under the prior "Arrangement Regarding InternationalTrade in Textiles" (known as the Multifiber Arrangement (MFA)). Under the MFA, adeparture from GATT 1947 provisions, importing and exporting countries negotiatedbilateral agreements limiting textile and apparel shipments, and importing countries could

A-4

take unilateral action to control shipments. Quantitative limits were established on textilesand apparel of cotton, other vegetable fibers, wool, man-made fibers or silk blends in aneffort to prevent or limit market disruption in the importing countries. The ATC establishesnotification and safeguard procedures, along with other rules concerning the customstreatment of textile and apparel shipments, and calls for the eventual complete integrationof this sector into the GATT 1994 and the phase-out of quotas over a ten-year period, or byJan. 1, 2005.

APPENDIX BSTATISTICAL TABLES

B-2

Table B-1Organic commodity chemicals: U.S. imports for consumption, by principal sources, 1997-2001

(1,000 dollars)

Item/country 1997 1998 1999 2000 2001

Cyclohexane:Argentina . . . . . . . . . . . . . . . . . . . . . . 7,282 4,569 3,321 0 6,793United Kingdom . . . . . . . . . . . . . . . . . 0 0 0 0 6,688Belgium . . . . . . . . . . . . . . . . . . . . . . . 0 16 0 0 3,225Saudi Arabia . . . . . . . . . . . . . . . . . . . 0 0 0 0 2,357Netherlands . . . . . . . . . . . . . . . . . . . . 0 14 891 0 1,669Indonesia . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 265All others . . . . . . . . . . . . . . . . . . . . . . 18,436 853 1,028 526 129

Total . . . . . . . . . . . . . . . . . . . . . . . 25,718 5,452 5,241 526 21,127Dicyclopentadiene:

Japan . . . . . . . . . . . . . . . . . . . . . . . . . 6,062 5,229 5,261 4,947 5,620Canada . . . . . . . . . . . . . . . . . . . . . . . 3,685 6,411 14,057 6,954 4,229Brazil . . . . . . . . . . . . . . . . . . . . . . . . . 710 1,256 2,155 2,325 3,513Korea . . . . . . . . . . . . . . . . . . . . . . . . . 0 138 390 406 236Austria . . . . . . . . . . . . . . . . . . . . . . . . 0 29 18 34 54Spain . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 5 0 49All others . . . . . . . . . . . . . . . . . . . . . . 797 332 11 2 39

Total . . . . . . . . . . . . . . . . . . . . . . . 11,254 13,394 21,898 14,669 13,740Other cyclanes, cyclenes, and

cycloterpenes:Japan . . . . . . . . . . . . . . . . . . . . . . . . . 3,598 4,846 8,653 8,444 7,081Brazil . . . . . . . . . . . . . . . . . . . . . . . . . 592 799 974 621 1,270Canada . . . . . . . . . . . . . . . . . . . . . . . 126 80 1,500 4,189 1,260Germany . . . . . . . . . . . . . . . . . . . . . . 573 794 1,459 1,589 1,155Chile . . . . . . . . . . . . . . . . . . . . . . . . . . 903 585 711 445 712Spain . . . . . . . . . . . . . . . . . . . . . . . . . 447 437 641 666 506All others . . . . . . . . . . . . . . . . . . . . . . 9,114 8,575 5,885 2,764 1,735

Total . . . . . . . . . . . . . . . . . . . . . . . 15,353 16,116 19,823 18,719 13,720ortho-Xylene:

Venezuela . . . . . . . . . . . . . . . . . . . . . 4,519 3,127 11,845 26,788 11,913Canada . . . . . . . . . . . . . . . . . . . . . . . 11,168 7,425 6,413 7,779 7,935Iraq . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 2,495 7,005 2,611 5,211Colombia . . . . . . . . . . . . . . . . . . . . . . 2,667 1,355 3,241 5,174 4,500Saudi Arabia . . . . . . . . . . . . . . . . . . . 9,137 11,820 6,058 619 2,380Nigeria . . . . . . . . . . . . . . . . . . . . . . . . 8,655 8,742 3,967 12,695 2,318All others . . . . . . . . . . . . . . . . . . . . . . 15,367 11,375 4,881 3,615 3,091

Total . . . . . . . . . . . . . . . . . . . . . . . 51,513 46,339 43,409 59,282 37,349meta-Xylene:

Canada . . . . . . . . . . . . . . . . . . . . . . . 79 104 75 484 3,808Belgium . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 22 0Colombia . . . . . . . . . . . . . . . . . . . . . . 0 0 0 1,016 0Iraq . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 768 309 0Korea . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 1,079 0 0Netherlands . . . . . . . . . . . . . . . . . . . . 1 2 0 0 0All others . . . . . . . . . . . . . . . . . . . . . . 7,163 12,296 5,256 3,466 0

Total . . . . . . . . . . . . . . . . . . . . . . . 7,243 12,402 7,178 5,298 3,808

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Table B-1–ContinuedOrganic commodity chemicals: U.S. imports for consumption, by principal sources, 1997-2001

(1,000 dollars)

Item/country 1997 1998 1999 2000 2001

para-Xylene:Saudi Arabia . . . . . . . . . . . . . . . . . . . 28,155 21,201 9,174 41,135 40,325Venezuela . . . . . . . . . . . . . . . . . . . . . 12,074 6,719 17,000 48,051 21,281India . . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 19,841Iraq . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 9,901 20,071 8,206 18,163Colombia . . . . . . . . . . . . . . . . . . . . . . 10,298 7,850 22,618 38,012 12,964Korea . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 1,112 8,546All others . . . . . . . . . . . . . . . . . . . . . . 175,672 127,167 69,415 95,794 24,638

Total . . . . . . . . . . . . . . . . . . . . . . . 226,199 172,838 138,277 232,310 145,758Styrene:

Canada . . . . . . . . . . . . . . . . . . . . . . . 169,913 121,032 223,396 448,597 462,430Saudi Arabia . . . . . . . . . . . . . . . . . . . 0 0 0 0 4,134Netherlands . . . . . . . . . . . . . . . . . . . . 0 0 3,986 468 45India . . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 28Italy . . . . . . . . . . . . . . . . . . . . . . . . . . 58 44 0 0 18Iraq . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 14All others . . . . . . . . . . . . . . . . . . . . . . 3,456 14,052 3,795 33,158 10

Total . . . . . . . . . . . . . . . . . . . . . . . 173,427 135,127 231,177 482,223 466,679Ethylbenzene:

Canada . . . . . . . . . . . . . . . . . . . . . . . 826 255 35 97 16,108Netherlands . . . . . . . . . . . . . . . . . . . . 0 0 0 0 3,016Spain . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 5Brazil . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 0Germany . . . . . . . . . . . . . . . . . . . . . . 0 14 0 0 0Saudi Arabia . . . . . . . . . . . . . . . . . . . 0 0 14 0 0All others . . . . . . . . . . . . . . . . . . . . . . 719 0 5 0 0

Total . . . . . . . . . . . . . . . . . . . . . . . 1,545 269 54 97 19,129Cumene:

Venezuela . . . . . . . . . . . . . . . . . . . . . 43,643 34,081 29,466 62,552 47,174Norway . . . . . . . . . . . . . . . . . . . . . . . . 13,035 12,628 12,539 25,668 36,151Saudi Arabia . . . . . . . . . . . . . . . . . . . 24,146 22,536 22,019 35,952 31,483Iraq . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 17,095 18,307 30,074Colombia . . . . . . . . . . . . . . . . . . . . . . 6,086 7,976 12,034 21,662 27,261Nigeria . . . . . . . . . . . . . . . . . . . . . . . . 26,106 32,479 46,486 68,735 13,339All others . . . . . . . . . . . . . . . . . . . . . . 75,115 32,285 26,064 33,079 15,703

Total . . . . . . . . . . . . . . . . . . . . . . . 188,130 141,985 165,704 265,954 201,185Pseudocumene:

Iraq . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 1,287 971 1,289Colombia . . . . . . . . . . . . . . . . . . . . . . 507 579 156 1,233 799Algeria . . . . . . . . . . . . . . . . . . . . . . . . 0 0 172 0 386Nigeria . . . . . . . . . . . . . . . . . . . . . . . . 632 5,943 473 2,819 348United Kingdom . . . . . . . . . . . . . . . . . 536 643 334 700 31China . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 209 688 14All others . . . . . . . . . . . . . . . . . . . . . . 2,131 1,493 484 1,537 0

Total . . . . . . . . . . . . . . . . . . . . . . . 3,806 8,658 3,114 7,948 2,868

B-4

Table B-1–ContinuedOrganic commodity chemicals: U.S. imports for consumption, by principal sources, 1997-2001

(1,000 dollars)

Item/country 1997 1998 1999 2000 2001

Acenaphthene, chrysene, cymene,dimethylnaphthalenes,fluoranthene, fluorene, indene,mesitylene, and other specifiedcyclic hydrocarbons:

China . . . . . . . . . . . . . . . . . . . . . . . . . 3 178 0 5 3,665Germany . . . . . . . . . . . . . . . . . . . . . . 2,879 2,885 1,351 2,612 2,046Italy . . . . . . . . . . . . . . . . . . . . . . . . . . 1,621 2,089 474 1,436 937Japan . . . . . . . . . . . . . . . . . . . . . . . . . 632 1,207 1,097 2,284 465Ecuador . . . . . . . . . . . . . . . . . . . 0 0 0 0 23Austria . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 11All others . . . . . . . . . . . . . . . . . . . . . . 204 323 237 55 27

Total . . . . . . . . . . . . . . . . . . . . . . . 5,339 6,682 3,159 6,392 7,175Dodecylbenzene:

Japan . . . . . . . . . . . . . . . . . . . . . . . . . 1,911 2,430 3,350 3,534 3,666Venezuela . . . . . . . . . . . . . . . . . . . . . 0 15 91 0 200Canada . . . . . . . . . . . . . . . . . . . . . . . 0 0 9 18 9Belgium . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 3 8China . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 2 7France . . . . . . . . . . . . . . . . . . . . . . . . 308 104 0 0 0All others . . . . . . . . . . . . . . . . . . . . . . 29 538 0 0 0

Total . . . . . . . . . . . . . . . . . . . . . . . 2,248 3,087 3,449 3,556 3,891Other alkyl and polyalkyl benzenes:

Spain . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 124Netherlands . . . . . . . . . . . . . . . . . . . . 0 112 194 0 76Israel . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 11 25 25United Kingdom . . . . . . . . . . . . . . . . . 434 13 471 16 19Switzerland . . . . . . . . . . . . . . . . . . . . 17 7 7 3 15Japan . . . . . . . . . . . . . . . . . . . . . . . . . 1,942 539 145 15 5All others . . . . . . . . . . . . . . . . . . . . . . 10,946 2,855 941 995 2

Total . . . . . . . . . . . . . . . . . . . . . . . 13,339 3,527 1,769 1,054 267Anthracene and 1,4-di-(2-

methylstyryl) benzene:Netherlands . . . . . . . . . . . . . . . . . . . . 0 0 13 20 14China . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 4 3 6India . . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 3Japan . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 3Germany . . . . . . . . . . . . . . . . . . . . . . 56 12 12 5 0Hungary . . . . . . . . . . . . . . . . . . . . . . . 12 106 82 0 0All others . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 0

Total . . . . . . . . . . . . . . . . . . . . . . . 68 118 110 28 26Biphenyl (diphenyl), in flakes:

United Kingdom . . . . . . . . . . . . . . . . . 23 92 71 104 138Japan . . . . . . . . . . . . . . . . . . . . . . . . . 19 43 53 20 17Canada . . . . . . . . . . . . . . . . . . . . . . . 0 0 20 2 12Lithuania . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 2Austria . . . . . . . . . . . . . . . . . . . . . . . . 8 0 0 0 0Germany . . . . . . . . . . . . . . . . . . . . . . 0 6 0 0 0All others . . . . . . . . . . . . . . . . . . . . . . 0 59 0 0 0

Total . . . . . . . . . . . . . . . . . . . . . . . 50 199 144 126 170

B-5

Table B-1–ContinuedOrganic commodity chemicals: U.S. imports for consumption, by principal sources, 1997-2001

(1,000 dollars)

Item/country 1997 1998 1999 2000 2001

Other cyclic hydrocarbons:Canada . . . . . . . . . . . . . . . . . . . . . . . 6,010 4,894 1,894 16,062 17,827Germany . . . . . . . . . . . . . . . . . . . . . . 2,096 1,054 6,772 7,669 6,214Netherlands . . . . . . . . . . . . . . . . . . . . 1,844 1,255 805 861 1,327Japan . . . . . . . . . . . . . . . . . . . . . . . . . 777 958 1,322 1,432 1,047Belgium . . . . . . . . . . . . . . . . . . . . . . . 554 1,593 961 539 951Spain . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 415All others . . . . . . . . . . . . . . . . . . . . . . 1,746 1,145 1,808 1,508 1,559

Total . . . . . . . . . . . . . . . . . . . . . . . 13,027 10,899 13,562 28,070 29,341Cyclohexanol, methylcyclohexanols

and dimethylcyclohexanols:Germany . . . . . . . . . . . . . . . . . . . . . . 3 18 3 4 15India . . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 4France . . . . . . . . . . . . . . . . . . . . . . . . 0 841 677 0 0Japan . . . . . . . . . . . . . . . . . . . . . . . . . 7,916 4,621 4,056 1,215 0Netherlands . . . . . . . . . . . . . . . . . . . . 841 0 0 0 0Canada . . . . . . . . . . . . . . . . . . . . . . . 0 9 0 0 0All others . . . . . . . . . . . . . . . . . . . . . . 34 23 4 0 0

Total . . . . . . . . . . . . . . . . . . . . . . . 8,794 5,512 4,739 1,220 19Phenol (hydroxybenzene) and its

salts:Mexico . . . . . . . . . . . . . . . . . . . . . . . . 13,748 11,456 7,522 12,848 5,779South Africa . . . . . . . . . . . . . . . . . . . . 0 0 341 0 1,261Japan . . . . . . . . . . . . . . . . . . . . . . . . . 28,168 27,245 10,972 0 382Canada . . . . . . . . . . . . . . . . . . . . . . . 253 261 361 336 329Indonesia . . . . . . . . . . . . . . . . . . . . . . 0 0 42 26 19United Kingdom . . . . . . . . . . . . . . . . . 19 17 15 10 13All others . . . . . . . . . . . . . . . . . . . . . . 39,728 43,710 51,067 11,825 10

Total . . . . . . . . . . . . . . . . . . . . . . . 81,916 82,689 70,319 25,045 7,793Phthalic anhydride:

Mexico . . . . . . . . . . . . . . . . . . . . . . . . 6,594 6,179 4,826 5,216 3,335Venezuela . . . . . . . . . . . . . . . . . . . . . 2,978 793 1,566 2,081 1,800Israel . . . . . . . . . . . . . . . . . . . . . . . . . 57 0 25 1,243 1,205Brazil . . . . . . . . . . . . . . . . . . . . . . . . . 106 0 32 845 654Korea . . . . . . . . . . . . . . . . . . . . . . . . . 33 10 0 0 113Turkey . . . . . . . . . . . . . . . . . . . . . . . . 0 190 0 296 90All others . . . . . . . . . . . . . . . . . . . . . . 2 51 267 265 157

Total . . . . . . . . . . . . . . . . . . . . . . . 9,769 7,223 6,714 9,947 7,353Terephthalic acid and its salts:

Belgium . . . . . . . . . . . . . . . . . . . . . . . 0 3 4 0 20,952Mexico . . . . . . . . . . . . . . . . . . . . . . . . 7,340 3,140 10,574 20,468 3,388Spain . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 336Indonesia . . . . . . . . . . . . . . . . . . . . . . 14 0 0 0 276Korea . . . . . . . . . . . . . . . . . . . . . . . . . 0 179 280 0 14Canada . . . . . . . . . . . . . . . . . . . . . . . 21 0 0 0 5All others . . . . . . . . . . . . . . . . . . . . . . 238 167 0 13 0

Total . . . . . . . . . . . . . . . . . . . . . . . 7,613 3,489 10,857 20,481 24,971

B-6

Table B-1–ContinuedOrganic commodity chemicals: U.S. imports for consumption, by principal sources, 1997-2001

(1,000 dollars)

Item/country 1997 1998 1999 2000 2001

Dimethyl terephthalate:Italy . . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 4,672Mexico . . . . . . . . . . . . . . . . . . . . . . . . 424 418 954 1,781 946Germany . . . . . . . . . . . . . . . . . . . . . . 19 19 17 53 32Spain . . . . . . . . . . . . . . . . . . . . . . . . . 56 171 213 128 22Brazil . . . . . . . . . . . . . . . . . . . . . . . . . 0 13 294 583 0Netherlands . . . . . . . . . . . . . . . . . . . . 0 0 0 4 0All others . . . . . . . . . . . . . . . . . . . . . . 1 40 24 7 0

Total . . . . . . . . . . . . . . . . . . . . . . . 500 661 1,502 2,556 5,672Aniline:

Germany . . . . . . . . . . . . . . . . . . . . . . 0 0 908 0 2,473China . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 42 25United Kingdom . . . . . . . . . . . . . . . . . 5,868 7,596 6,062 0 9Mexico . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 6Japan . . . . . . . . . . . . . . . . . . . . . . . . . 7,405 4,176 13 6 3France . . . . . . . . . . . . . . . . . . . . . . . . 329 0 0 0 0All others . . . . . . . . . . . . . . . . . . . . . . 3,757 0 3 2,835 0

Total . . . . . . . . . . . . . . . . . . . . . . . 17,360 11,772 6,987 2,884 2,517Aniline salts:

Japan . . . . . . . . . . . . . . . . . . . . . . . . . 190 10 10 0 5China . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 3Sweden . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 3Germany . . . . . . . . . . . . . . . . . . . . . . 4 3 0 5 3

Total . . . . . . . . . . . . . . . . . . . . . . . 194 13 10 5 14

6-Hexanelactam (epsilon-caprolactam):

Brazil . . . . . . . . . . . . . . . . . . . . . . . . . 4,008 3,138 1,824 3,642 2,668Poland . . . . . . . . . . . . . . . . . . . . . . . . 149 1,629 1,780 837 2,097Russia . . . . . . . . . . . . . . . . . . . . . . . . 13,432 25,784 811 685 523Germany . . . . . . . . . . . . . . . . . . . . . . 22,765 2,003 95 4,709 337Japan . . . . . . . . . . . . . . . . . . . . . . . . . 0 117 254 253 253Colombia . . . . . . . . . . . . . . . . . . . . . . 6,099 11,011 9,201 350 202Belgium . . . . . . . . . . . . . . . . . . . . . . . 7,105 21 102 43 123All others . . . . . . . . . . . . . . . . . . . . . . 4,805 8,504 4,514 1,763 9

Total . . . . . . . . . . . . . . . . . . . . . . . 58,362 52,207 18,582 12,282 6,213Grand totals . . . . . . . . . . . . . . . . . 922,767 740,657 777,781 1,200,671 1,020,782

Note.—Due to rounding, totals may not match the sum of all entries.

Source: Compiled from official statistics of the U.S. Department of Commerce.

B-7

Table B-2Organic commodity chemicals: U.S. exports of domestic merchandise, by principal markets, 1997-2001

(1,000 dollars)

Item/country 1997 1998 1999 2000 2001

Cyclohexane:Canada . . . . . . . . . . . . . . . . . . . . . . 41,465 33,485 37,793 55,355 47,506Mexico . . . . . . . . . . . . . . . . . . . . . . . 7,854 10,023 9,011 37,771 27,729Belgium . . . . . . . . . . . . . . . . . . . . . . 1,995 8,635 15,911 25,257 7,071India . . . . . . . . . . . . . . . . . . . . . . . . . 35 92 134 4,337 1,414Venezuela . . . . . . . . . . . . . . . . . . . . 878 10 1,269 430 1,368Netherlands . . . . . . . . . . . . . . . . . . . 3,226 11,576 12,201 12,847 928All Others . . . . . . . . . . . . . . . . . . . . . 2,755 3,483 2,143 1,586 1,327

Total . . . . . . . . . . . . . . . . . . . . . 58,208 67,304 78,461 137,584 87,343Cyclanes, cyclenes and cycloterpenes

(excluding cyclohexane):Netherlands . . . . . . . . . . . . . . . . . . . 113 1,526 536 2,534 6,967Brazil . . . . . . . . . . . . . . . . . . . . . . . . 411 223 460 1,030 4,948France . . . . . . . . . . . . . . . . . . . . . . . 11,992 9,901 5,777 3,547 3,255United Kingdom . . . . . . . . . . . . . . . . 2,578 2,836 2,239 1,558 2,890Mexico . . . . . . . . . . . . . . . . . . . . . . . 4,149 1,037 1,716 2,644 2,625Belgium . . . . . . . . . . . . . . . . . . . . . . 3,981 2,256 4,380 4,079 2,599All others . . . . . . . . . . . . . . . . . . . . . 14,889 7,797 8,635 13,151 10,719

Total . . . . . . . . . . . . . . . . . . . . . 38,113 25,576 23,743 28,542 34,003ortho-Xylene:

Mexico . . . . . . . . . . . . . . . . . . . . . . . 1,686 2,027 2,546 15,741 16,577Netherlands . . . . . . . . . . . . . . . . . . . 7,460 2,107 1,300 12,623 2,646Venezuela . . . . . . . . . . . . . . . . . . . . 0 0 570 3,099 2,496India . . . . . . . . . . . . . . . . . . . . . . . . . 5,469 1,547 990 0 1,315Canada . . . . . . . . . . . . . . . . . . . . . . 230 575 496 518 831El Salvador . . . . . . . . . . . . . . . . . . . 0 0 0 0 9All others . . . . . . . . . . . . . . . . . . . . . 4,727 2,184 2,262 1,000 30

Total . . . . . . . . . . . . . . . . . . . . . 19,572 8,441 8,164 32,982 23,903meta-Xylene:

Belgium . . . . . . . . . . . . . . . . . . . . . . 0 21,615 16,297 23,193 14,644Egypt . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 69 32Korea . . . . . . . . . . . . . . . . . . . . . . . . 0 11,074 3,411 0 24Canada . . . . . . . . . . . . . . . . . . . . . . 6 0 6 3 7Trinidad and Tobago . . . . . . . . . . . . 0 0 8 17 6Mexico . . . . . . . . . . . . . . . . . . . . . . . 0 6 3,094 6 3All others . . . . . . . . . . . . . . . . . . . . . 63 10 1,278 130 0

Total . . . . . . . . . . . . . . . . . . . . . 69 32,705 24,094 23,418 14,716para-Xylene:

Mexico . . . . . . . . . . . . . . . . . . . . . . . 112,815 98,628 121,167 239,020 251,845Taiwan . . . . . . . . . . . . . . . . . . . . . . . 31,651 37,609 30,645 69,917 24,569Brazil . . . . . . . . . . . . . . . . . . . . . . . . 6,674 14,676 2,101 18,672 17,441Pakistan . . . . . . . . . . . . . . . . . . . . . . 0 3,972 3,632 4,831 12,277Malaysia . . . . . . . . . . . . . . . . . . . . . 7,185 10,990 13,966 32,704 10,155Korea . . . . . . . . . . . . . . . . . . . . . . . . 43,511 18,558 23,561 51,369 9,743All others . . . . . . . . . . . . . . . . . . . . . 33,130 43,125 65,675 24,195 17,634

Total . . . . . . . . . . . . . . . . . . . . . 234,966 227,558 260,747 440,708 343,664

B-8

Table B-2–ContinuedOrganic commodity chemicals: U.S. exports of domestic merchandise, by principal markets, 1997-2001

(1,000 dollars)

Item/country 1997 1998 1999 2000 2001

Styrene:Mexico . . . . . . . . . . . . . . . . . . . . . . . 77,870 92,138 133,104 209,143 182,237Taiwan . . . . . . . . . . . . . . . . . . . . . . . 65,050 38,361 154,230 168,763 59,997Colombia . . . . . . . . . . . . . . . . . . . . . 47,562 39,377 38,999 57,473 44,277Canada . . . . . . . . . . . . . . . . . . . . . . 21,484 21,646 32,596 42,984 36,289Venezuela . . . . . . . . . . . . . . . . . . . . 25,871 12,876 18,199 29,237 25,816Netherlands . . . . . . . . . . . . . . . . . . . 54,297 75,939 117,636 125,832 24,804All others . . . . . . . . . . . . . . . . . . . . . 98,905 70,729 133,130 288,825 59,558

Total . . . . . . . . . . . . . . . . . . . . . 391,039 351,068 627,894 922,257 432,977Ethylbenzene:

Netherlands . . . . . . . . . . . . . . . . . . . 19,488 14,229 1,790 4,713 2,956Japan . . . . . . . . . . . . . . . . . . . . . . . . 445 589 475 458 340Mexico . . . . . . . . . . . . . . . . . . . . . 187 282 53 157 226Canada . . . . . . . . . . . . . . . . . . . . . . 4 131 126 118 85Thailand . . . . . . . . . . . . . . . . . . . . . . 111 136 109 147 82Germany . . . . . . . . . . . . . . . . . . 0 0 0 63 34All others . . . . . . . . . . . . . . . . . . . . . 11,768 3,860 3,009 13,090 33

Total . . . . . . . . . . . . . . . . . . . . . 32,003 19,227 5,561 18,745 3,758Cumene:

Belgium . . . . . . . . . . . . . . . . . . . . 8,762 2,892 4,834 15,184 24,258Netherlands . . . . . . . . . . . . . . . . . . . 21,108 28,072 22,340 41,993 11,928Mexico . . . . . . . . . . . . . . . . . . . . . . 4,143 10,900 17,505 22,786 10,392India . . . . . . . . . . . . . . . . . . . . . . . . . 7,263 1,455 6,235 11,031 8,639Italy . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 5,575United Kingdom . . . . . . . . . . . . . . . . 0 2,540 6,799 0 4,443All others . . . . . . . . . . . . . . . . . . . . . 3,517 23,623 4,822 32,291 3,136

Total . . . . . . . . . . . . . . . . . . . . . 44,793 69,482 62,537 123,284 68,371Dodecylbenzene:

Mexico . . . . . . . . . . . . . . . . . . . . . . . 1,137 0 20 11 110Italy . . . . . . . . . . . . . . . . . . . . . . . . . 61 142 332 121 60Korea . . . . . . . . . . . . . . . . . . . . . . . . 46 0 0 22 34United Kingdom . . . . . . . . . . . . . . . . 0 0 0 0 8Japan . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 5Barbados . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 4All others . . . . . . . . . . . . . . . . . . . . . 268 296 45 270 0

Total . . . . . . . . . . . . . . . . . . . . . 1,512 438 397 424 221Other alkyl and polyalkyl

benzenes:Mexico . . . . . . . . . . . . . . . . . . . . . . . 1,333 422 3,934 49 15,923Netherlands . . . . . . . . . . . . . . . . . . . 2,389 2,524 2,882 2,125 3,890Thailand . . . . . . . . . . . . . . . . . . . . . . 3 9 2,222 90 3,756France . . . . . . . . . . . . . . . . . . . . . . . 462 269 509 52 1,848India . . . . . . . . . . . . . . . . . . . . . . . . . 54 2,390 5 49 1,402Japan . . . . . . . . . . . . . . . . . . . . . . . . 930 1,043 907 1,284 1,324All others . . . . . . . . . . . . . . . . . . . . . 6,185 3,739 8,439 4,220 6,326

Total . . . . . . . . . . . . . . . . . . . . . 11,355 10,395 18,897 7,868 34,470

B-9

Table B-2–ContinuedOrganic commodity chemicals: U.S. exports of domestic merchandise, by principal markets, 1997-2001

(1,000 dollars)

Item/country 1997 1998 1999 2000 2001

Anthracene, biphenyl and cyclichydrocarbons not elsewhere specified or included:

Mexico . . . . . . . . . . . . . . . . . . . . . . . 819 1,466 5,440 1,579 4,348Netherlands . . . . . . . . . . . . . . . . . . . 4,773 2,611 1,375 3,587 3,763Canada . . . . . . . . . . . . . . . . . . . . . . 2,597 2,560 2,066 3,042 3,077Belgium . . . . . . . . . . . . . . . . . . . . . . 414 89 648 5,977 1,796Brazil . . . . . . . . . . . . . . . . . . . . . . . . 206 229 76 1,102 1,574Italy . . . . . . . . . . . . . . . . . . . . . . . . . 1,107 1,162 1,332 2,432 1,418All others . . . . . . . . . . . . . . . . . . . . . 9,140 11,325 12,048 12,035 4,013

Total . . . . . . . . . . . . . . . . . . . . . 19,056 19,441 22,985 29,755 19,989Cyclohexanol, methylcyclohexanols and

dimethylcyclohexanols:Japan . . . . . . . . . . . . . . . . . . . . . . . . 0 0 32 131 470Taiwan . . . . . . . . . . . . . . . . . . . . . . . 0 10 0 0 157Mexico . . . . . . . . . . . . . . . . . . . . . . . 56 97 49 13 50Nauru . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 16Qatar . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 10Chile . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 4All others . . . . . . . . . . . . . . . . . . . . . 324 418 208 107 13

Total . . . . . . . . . . . . . . . . . . . . . 380 525 289 251 721Phenol (hydroxybenzene) and its salts:

Canada . . . . . . . . . . . . . . . . . . . . . . 63,144 68,547 49,820 61,367 79,808Netherlands . . . . . . . . . . . . . . . . . . . 7,933 9,971 4,183 24,126 21,251Brazil . . . . . . . . . . . . . . . . . . . . . . . . 2,012 829 140 12,898 12,324Korea . . . . . . . . . . . . . . . . . . . . . . . . 2,249 950 3,103 7,814 11,111China . . . . . . . . . . . . . . . . . . . . . . . . 924 0 3,323 8,783 8,232Argentina . . . . . . . . . . . . . . . . . . . . . 1,048 5,862 3,169 2,282 5,188All others . . . . . . . . . . . . . . . . . . . . . 19,487 22,709 18,774 40,670 33,154

Total . . . . . . . . . . . . . . . . . . . . . 96,797 108,867 82,512 157,939 171,069Phthalic anhydride:

Canada . . . . . . . . . . . . . . . . . . . . . . 12,122 9,477 12,740 14,779 12,444Taiwan . . . . . . . . . . . . . . . . . . . . . . . 2,473 1,117 0 0 2,375Indonesia . . . . . . . . . . . . . . . . . . . . . 238 127 31 130 151Mexico . . . . . . . . . . . . . . . . . . . . . . . 333 9 383 1,862 138Philippines . . . . . . . . . . . . . . . . . . . . 18 15 6 26 20Korea . . . . . . . . . . . . . . . . . . . . . . . . 10 0 6 12 18All others . . . . . . . . . . . . . . . . . . . . . 144 244 169 4 10

Total . . . . . . . . . . . . . . . . . . . . . 15,338 10,990 13,336 16,813 15,157Terephthalic acid and its salts:

Canada . . . . . . . . . . . . . . . . . . . . . . 80,992 83,199 82,614 79,816 91,001Argentina . . . . . . . . . . . . . . . . . . . . . 3 10,744 21,115 0 36,350Indonesia . . . . . . . . . . . . . . . . . . . . . 11,989 397 0 0 523Brazil . . . . . . . . . . . . . . . . . . . . . . . . 9,752 8.969 5,776 2,713 363Mexico . . . . . . . . . . . . . . . . . . . . . . . 0 11 0 24 14Dominican Republic . . . . . . . . . . . . . 0 0 0 0 11All others . . . . . . . . . . . . . . . . . . . . . 88,329 86,740 35,434 6.940 0

Total . . . . . . . . . . . . . . . . . . . . . 191,064 190,060 144,939 89,492 128,262

B-10

Table B-2–ContinuedOrganic commodity chemicals: U.S. exports of domestic merchandise, by principal markets, 1997-2001

(1,000 dollars)

Item/country 1997 1998 1999 2000 2001

Dimethyl terephthalate:Brazil . . . . . . . . . . . . . . . . . . . . . . . . 4 9 52 12 985Taiwan . . . . . . . . . . . . . . . . . . . . . . . 275 0 393 2,297 645Mexico . . . . . . . . . . . . . . . . . . . . . . . 0 0 167 879 246Colombia . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 33Israel . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 22United Kingdom . . . . . . . . . . . . . . . . 0 0 0 11 12All others . . . . . . . . . . . . . . . . . . . . . 3,323 4,751 1,808 192 7

Total . . . . . . . . . . . . . . . . . . . . . 3,603 4,760 2,420 3,391 1,949Aniline and its salts:

Korea . . . . . . . . . . . . . . . . . . . . . . . . 686 0 3,269 9,375 11,863India . . . . . . . . . . . . . . . . . . . . . . . . . 0 2,206 0 42 690Japan . . . . . . . . . . . . . . . . . . . . . . . . 2,854 3,584 2,594 3,291 483China . . . . . . . . . . . . . . . . . . . . . . . . 158 767 0 0 474Mexico . . . . . . . . . . . . . . . . . . . . . . . 1,783 1,517 1,770 893 433Netherlands . . . . . . . . . . . . . . . . . . . 216 1,402 1,987 1,431 359All others . . . . . . . . . . . . . . . . . . . . . 829 1,793 722 912 538

Total . . . . . . . . . . . . . . . . . . . . . 6,526 11,269 10,343 15,944 14,8426-Hexanelactam (epsilon-

caprolactam):Taiwan . . . . . . . . . . . . . . . . . . . . . . . 75,928 64,593 45,092 58,262 41,535Canada . . . . . . . . . . . . . . . . . . . . . . 39,679 38,438 31,878 29,388 39,423Korea . . . . . . . . . . . . . . . . . . . . . . . . 3,303 5,022 4,668 3,043 11,834Indonesia . . . . . . . . . . . . . . . . . . . . . 0 0 0 0 3,111China . . . . . . . . . . . . . . . . . . . . . . . . 0 3 540 6 1,624Argentina . . . . . . . . . . . . . . . . . . . . . 0 0 0 1,303 1,146All others . . . . . . . . . . . . . . . . . . . . . 94 116 4,026 4,865 244

Total . . . . . . . . . . . . . . . . . . . . . 119,004 108,172 86,205 96,867 98,916Grand totals . . . . . . . . . . . . . . . 1,283,396 1,266,276 1,473,522 2,146,265 1,494,331

Note.—Due to rounding, totals may not match the sum of all entries.

Source: Compiled from official statistics of the U.S. Department of Commerce.